Resolution No. 8632
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RESOLUTION NO. 8632
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A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
VERNON APPROVING AND AUTHORIZING THE EXECUTION OF A
GROUND LEASE BY AND BETWEEN THE CITY OF VERNON AND
UNION ICE-PACIFIC, L.P., THROUGH ITS GENERAL
PARTNER, UNION ICE GP INC. FOR 50TH STREET
7 WHEREAS, the City of Vernon (the "City") is a municipal
8 corporation and a chartered city of the State of California organized
9 and existing under its Charter and the Constitution of the State of
10 California; and
11 WHEREAS, the City is the owner of certain real property
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12 located at south side of 50th Street in the City of Vernon consisting
13 of approximately 113,000 square feet of land, including a building
14 (the "Property"), which is surplus to the City's present needs; and
15 WHEREAS, Section 37380(a) of the Government Code of the State
16 of California provides that a city may lease property owned or held or
17 controlled by it, or any of its departments, for a term not to exceed
18 55 years; and
19 WHEREAS, Section 37395 of the Government Code of the State of
20 California provides that a city may lease property for commercial
21 development for business purposes, when the governing body determines
22 that the property is not required for other city purposes; and
23 WHEREAS, Union Ice-Pacific, L.P., a California Limited
24 Partnership, through its General Partner, Union Ice GP Inc., a Texas
25 Corporation ("Union Ice"), desires to lease the Property and renovate
26 the existing building for use as an ice production and food processing
27 and cold storage facility; and
28 WHEREAS, on January 5, 2005, the Finance Committee
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1 considered the recommendation of Bruce V. Malkenhorst, the Director of
2 Finance, dated December 29, 2004, that a lease with Union Ice be
3 approved and executed for a monthly rental rate of $10,359.62.
4 NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
5 CITY OF VERNON AS FOLLOWS:
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SECTION 1:
The City Council of the City of Vernon hereby
7 finds and determines that the recitals contained hereinabove are true
8 and correct.
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SECTION 2:
The City Council of the City of Vernon hereby
10 approves the Ground Lease with Union Ice-Pacific, L.P., through its
11 General Partner, Union Ice GP Inc., a copy of which is attached hereto
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12 as Exhibit A and incorporated by reference.
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SECTION 3:
The City Council of the City of Vernon hereby
14 authorizes the Mayor to execute said Lease for, and on behalf of, the
15 City of Vernon and the City Clerk is hereby authorized to attest
16 thereto.
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SECTION 4:
The City Council of the City of Vernon hereby
18 directs the City Clerk, or his designee, to send one fully executed
19 Lease to:
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The Union Ice Company
Attn. Rich L. Burke, President and Chief Executive Officer
6100 E. Sheila Street
Los Angeles, CA 90040
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SECTION 5:
The City Clerk of the City of Vernon sball
2 certify to the passage of this resolution, and thereupon and
3 thereafter the same shall be in full force and effect.
4 APPROVED AND ADOPTED this 5th day of January, 2005.
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AT~ /~ -:IS C. MALB RG, M YOr
BRUCE V. MALKENHORST, City Clerk
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STATE OF CALIFORNIA
COUNTY OF LOS ANGELES
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I, BRUCE V. MALKENHORST, City Clerk of the City of Vernon, do
hereby certify that the foregoing Resolution, being Resolution No.
8632, was duly adopted by the City Council of the City of Vernon at a
regular meeting of the City Council duly held on Wednesday,January 5,
2005, and thereafter was duly signed by the Mayor of the City of
Vernon.
BRUCE V. MALKENHORST, City Clerk
(SEAL)
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EXHIBIT
A
GROUNULEASE'
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1. Basic Provisions ("Basic Provisions").
1.1 Parties: This Ground Lease ("Lease"), dated for reference purposes only, December 27,2004,
is made by and between the City of Vernon ("Lessor'') and Union Ice. Ltd., or a related entity designated by Union
Ice-Pacific, L.P., a California limited partnership, whose creditworthiness is reasonably acceptable to the Lessor and
who will use the Premises as set forth in Paragraph 6.1 ("Lessee"), (collectively, the "Parties," or individually a
"Party"). For the purposes of this Lease, the "Execution Date" shall mean the date upon which this Lease is fully
executed and delivered by both parties.
1.2 Premises: That certain real property, consisting of approximately 113,000 square feet of land
("Land"), including the building (the "Building") thereon, located at 50.h Street in the City of Vernon, County of
Los Angeles, State of California, which is more particularly described on Exhibit" A" attached hereto ("Premises").
As used herein, the Premises means the land and the Building (as the same may from time to time exist), but
excludes any mineral, oil, gas or other hydrocarbon substances.
\.3 Term: The term of this Lease (the "Term") shall commence on and as of the Execution Date, ~d
shall expire (without further notice from or to, or act by, either party) at II :59 p.m. on the twenty-fifth (25~
anniversary of the Rent Start Date (as defined in Paragraph 4.6) (the "Expiration Date''), unless earlier terminated or
extended pursuant to the terms of this Lease. If the Lease Term is extended pursuant to an Option, as defmed below,
the word "Term" shall mean and refer to the extended Tenn, and the term "Expiration Date" shall mean and refer
to the Expiration Date of the option term then in effect. Notwithstanding any provision of this Lease to the contrary,
Lessee shall have the right to terminate this Lease at any time following the renovation or reconstruction of the
Building, as set forth in Paragraph 7.2 below, in its sole discretion by providing prior written notice thereof to Lessor
not less than one hundred and eighty (180) days before the effective date of such termination.
1.4 Base Rent: $10,359.62 per month ("Base Rent''), payable on the first day of each month commencing
on the Rent Start Date set forth in Paragraph 4. The Base Rent is to be adjusted as set forth in Paragraph 4.
2. Premises.
2.1 Letting. Lessor hereby leases to Lessee, and Lessee hereby leases from Lessor, the Premises, for the
term, at the rental, and upon all of the terms, covenants and conditions set forth in this Lease. Unless otherwise
provided herein, any. statement of size set forth in this Lease, or that may have been used in calculating Rent, is an
approximation which the Parties agree is reasonable and any payments based thereon are not subject to revision
whether or not the actual size is more or less.
2.2 Acknowledgements. Lessee acknowledges that: (a) it has been advised by Lessor to satisfy itself
with respect to the condition of the Premises (including but not limited to the existing structure of the Building,
seismic and geological issues, the roof and the foundations, and all building systems, including electrical, plumbing,
water and sewer capacities and their suitability for Lessee's intended use), as well as all issues related to the
existence (if any) of Hazardous Substances (as defined in Paragraph 6.2(a)) on, in, under, or around the Premises,
and the existence (if any) of above ground or below ground storage tanks in, on, under, or around the Premises
(provided, however, that Lessor shall have sole responsibility for the existence of any Hazardous Materials in, on,
under or about the Premises prior to the Conunencement Date ("Existing HaMat Condition"), (b) Lessee sbaII
have made such investigations as it deems necessary with reference to such matters and all other matters related to
the Premises, including development and functionality, zoning, access, and value, and assumes all responsibility
therefor as the same relate to its reconstruction and,occupancy of the Premises, and (c) neither Lessor nor Lessor's
agents have made any oral or written representations or warranties with respect to any matters related to the Premises
other than as set forth in this Lease.
2.3 "As Is" and Where Is". (a) LESSEE IS RELYING SOLELY ON ITS OWN INSPECflON AND
EXAMINATION OF ALL LEGAL, PHYSICAL AND OTHER ASPECTS OF THE PREMISES IN ENTERING
INTO TIllS LEASE, AND NOT ON ANY WRI1TEN OR ORAL INFORMATION PROVIDED OR TO BE
PROVIDED BY LESSOR OTHER THAN AS SET FORTIlIN TIllS LEASE; (b) LESSEE IS LEASING THE
PREMISES ON AN "AS IS" AND "WHERE IS" AND "WITH ALL FAULTS" BASIS WITH ALL FAULTS
OR CONTINUING OBLIGATIONS NOW KNOWN OR HEREAFTER DISCOVERED BY LESSEE, EXCEPT
WI1H RESPECI' TO ANY EXISTING HAZMAT CONDmON; AND (c) LESSOR HAS NO OBLIGATION TO
REPAIR OR TO CORRECT ANY CONDmONS OR DEFECI'S AFFECI1NG TIlE PREMISES OR TO
COMPENSATE LESSEE FOR THE SAME, EXCEPT WITII RESPECI' TO ANY EXISTING HAZMAT
CONDmON.
2.4 Due Diligence. Because Lessee is relying on its own due diligence in regard to the condition of the
Premises, as set forth above, Lessee shall have a period of 60 days after the Execution Date in which to conduct and
complete its due diligence on the Premises (the "Due Diligence Period''). Lessee shall be entitled to possession of
the Premises for due diligence purposes on the Execution Date provided Lessee has provided to Lessor the certificate
of insurance described below. puring the Due Diligence Period, Lessee shall have the right to fully satisfy itself as
to the condition of the Premises, the usefulness of the Premises for its business purposes, the value of the Premises,
and all conditions related to the Premises, including environmental issues, geological and seismic issues, condition of
the Building and Building systems, and all other matters by making such tests, inspections or investigations as Lessee
deems necessary or proper in accordance with the tenns of this Paragraph 2.4. Lessee may, by written notice
delivered to Lessor prior to 6:00 PM on the last day of the Due Diligence Period, terminate this Lease in its sole
'"'-ion. If"""", doe. not -..... lb, [.e"., by _ noli", doliveR<! ,.;l!Un 1ho Duo Dil~~
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Ol91MlOO7 112620.1
. Lessee iv.ill have waived its right to terminate the Lease (except as 'otherwise set forth in this Lease), and this ~ '.
, sIIaII remain in full force and effect in accordance with its terms. If Lessee timely terminates this Lease, this Lease
shall be null and void, and of no force and effect, and neith'er party Will have any obligation or liability to the other.
Lessee shall not have the right to possession or to commence its due diligence Wltil Lessee has delivered to Lessor a
catificate of insurance evidencing insurance coverage as set forth in Paragraph 9, and such insurance shall remain in
fidI force and effect until the last day of the expiration of the Due Diligence Period, and, if the Lease is not then
tcnninated, Lessee shall maintain the insurance as required by Paragraph 9 until the termination of this Lease.
. Lessee shall indemnify, defend, and hold harmless Lessor against any damages, claims, costs, or expenses arising out
of Lessee's entry onto the Premises and due diligence inspections. If Lessee elects to terminate this Lease during the
Due Diligence Period, then Lessee shall return the Premises to its condition prior to any testing, and if this Lease
n:mains in effect following the Due Diligence Period, Lessee shall fill in any holes or borings created by any testing
No invasive or intrusive testing shall be permitted without the prior written consent of Lessor, and Lessor may elect
to be present at such testing.
3. Tenn.
3.1 Tenn. The Term shall commence on the Execution Date, subject to termination by Lessee on or
before the last day of the-Due Diligence Period. The Commencement Date shall be as defined in Paragraph 3.2, and
the Lease shall be subject to termination by Lessee as set forth in Paragraph 7.2 between the last day of the Due
Diligence Period and the Commencement Date. The Term shall end on the Expiration Date; provided, however, that
the Lease is further subject to early termination and extension on the terms set forth in this Lease.
3.2 Commencement Date. If Lessee does not terminate this Lease during the Due Diligence Period,
Lessee shall develop plans for its renovation, if any, of the Building, and. diligently proceed to obtain any necessary
governmental or quasi-governmental permits, approvals, and authorizations necessary for the renovation of the
Building in final, non-appealable form (COllectively, the "Permits"). The date on which the City of Vernon issues all
of the Permits required for Lessee's proposed renovation of the Building in final, non-appealable fonn shall be
rderred to as the "Commencement Date". (See Paragraph 7.2 re Lessee's right to terminate this Lease if Lessee
fails to obtain Permits timely). Notwithstanding the Commencement Date, Rent shall be payable on the terms set
forth in Paragraph 4.
4. Rent
4.1 Rent Defined. All monetary obligations of Lessee to Lessor under the terms of this Lease are deemed
to be rent ("Rent").
4.2 Base Rent. Lessee shall pay to Lessor fixed rent in advance in the amount of One HWldred Twenty-
FoarThousand Three Hundred Fifteen and 4O/JOOths Dollars ($124,315.40) NNN per year, payable in twelve (12)
equal monthly installments of Ten Thousand Three Hundred Fifty-Nine and 621100ths ($10,359.62), subject to
adjustment as set forth below (the "Base Rent"), on the Rent Start Date and thereafter on the tint (1-) day of each
calendar month during the Term. The Base Rent shall be adjusted upward (but never downward, and never by any
siugle increase exceeding fifteen percent (15%) of the Base Rent then in effect) on every tenth (10th) anniversary of
the Rent Start Date (the" Adjustment Date") during the Term. The then-applicable Base Rent shall be increased on
each Adjustment Date t() an amoWlt to be determined by adding to the then-applicable Base Rent an. amoWlt equal to
the then-applicable Base Rent multiplied by the percentage of increase. if any, of the "Consumer Price Index for All
Utban Consumers. Los Angeles-Anaheim-Riverside, California, Subgroup All Items (1982-1984=100)", published
by the United States Department of Labor, Bureau ofLahor Statistics (the "CPIj for (i) the calendar month which is
Ibm: (3) months immediately preceding the Rent Start Date (the "Base Index''), in the case of the first Adjustment
Date. and (il) the calendar month which is three (3) months immediately preceding the previous Adjustment Date. in
the case of all subsequent Adjustment Dates, and the month that is three (3) months preceding the month in which the
Adjustment Date occurs (the "Adjustment Index").
4.3 U navailabilitv of Index. If the Adjustment Index is unavailable on the date on which any installment
of Base Rent as adjusted shall become due, Lessee shall continue to pay the then-applicable Base Rent payable by
Lessee Wltil the Adjustment Index is available, and the adjustment, if any, shall be aggregated and paid retroactively
as one lump sum with the then-applicable Base Rent for the first (1st) month in which the Adjustment Index is
available. If the Bureau of Labor Statistics ceases to use the 1982-1984 base of 100 as the basis of calculation for the
CPI, then the Base Index and the Adjustment Index shall be adjusted in accordance with the conversion fonnula
published by the Bureau of Labor Statistics. If, at any time required for the determination of the amoWlt of any
adjustment in Base Rent, the CPI is no longer published or issued, Lessor shall reasonably select a reliable
governmental or other non-partisan publication evaluating the information theretofore used in determining the CPI,
and shall give Lessee no less than ten (10) days' prior written notice of such selection.
4.4 Additional Chal'2es. Lessee hereby assumes any and all burdens, obligations, expenses, and shall
perform all actions as may be required of or for the Premises, for Lessor's interest in the Premises, for Lessee's
interest in the Premises, and for any other occupant of the Premises, except for any obligations with respect to
Existing HazMat Conditions, which shall remain Lessor's obligation and responsibility. This Lease is a "triple net"
or "absolute net" of "net, net, net" or "bond" lease whereby the Rent accruing under this Lease shall be totally net to
Lessor; and accordingly, Lessee shall pay all taxes, insurance, repairs/maintenance costs, utility and other expenses
and charges of every kind and nature, whether currently. in effect or subsequently made payable relating to the
Premises (but not the income therefrom), including, without limitation. any property taxes that may be as~ssed as a
""'" of the l=e bcing _ a "T,..,,,," onde< Prop. 13, wlrich may ""'" '" heooore due ~~
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(collectively, "Additional Charges"), but excluding any pllyments for interest or principal under any Mortgage made
by Lessor relating to the Premises or any costs relating to Existing HazMat Conditions. All Additional Charges
which Lessee is obligated to pay under any provisions of this Lease, together with all interest and penalties that may
accrue on these Additional Charges in the event Lessee fails to pay them, as well as all other damages, costs and
expenses, including, without limitation, reasonable attorneys' fees and other legal and court costs which Lessor may
incur in enforcing this Lease, and any and all other sums which may become due by reason of Lessee's failure to
comply with its obligations under this Lease, shall be deemed to be Additional Rent. In the event of non-payment,
Lessor shall have all the rights and remedies as provided in the case of non-payment of Base Rent. If any law
currently in effect or subsequently enacted prohibits a Lessee from paying a tax or other charge that is contemplated
hereunder to be paid by Lessee, the amount of such tax or other charge shall be added to the Base Rent, as it is the
intent of the parties that Lessor have no obligation to pay any charges, fees, costs or taxes on account of the Premises
during the Term.
4.5 Payment. Lessee shall cause payment of Rent to be received by Lessor in lawful money of the
United States on or before the day on which it is due, without offset or deduction (except as specifically permitted in
this Lease). Rent for any period during the term hereof which is for less than one full calendar month shall be
prorated based upon the actual number of days of said month. Payment of Rent shall be made to Lessor at its address
stated herein or to such other persons or place as Lessor may from time to time designate in writing. Acceptance of a
payment which is less than the amount then due shall not be a waiver of Lessor's rights to the balance of such Rent,
regardless of Lessor's endorsement of any check so stating. In the event that any check, draft, or other instrument of
payment given by Lessee to Lessor is dishonored for any reason, Lessee agrees to pay to Lessor the greater of the
sum of $25 or the charge then imposed by Lessor's bank in addition to any Late Charge and after any two (2) such
payments in any twelve (12) month period Lessor, at its option, may require all future payments for 24 months to be
made by Lessee to be by cashier's check. If Lessee's payment of Base Rent is more than five (5) days late two (2) or
more times in any 12 month period, Lessor may require that all future payments of Base Rent be paid quarterly in
advance for the next 24 months. Payments will be applied first to accrued late charges and attorney's fees, second to
accrued interest, then to Base Rent and any remaining amount to any other outstanding charges or costs.
4.6 Rent Start Date. Base Rent shall be abated until the earlier of (a) the first anniversary of the
Commencement Date or (b) the date Lessee obtains from the City of Vernon an occupancy permit or temporary
occupancy permit for the entire Premises.
4.7 Additional Charges Start Date. During the Due Diligence Period, Lessee shall not be obligated to
pay Base Rent or any other Additional Charges (other than carrying the insurance described in Paragraph 9). After
the expiration of the Due Diligence Period, Lessee shall pay Additional Charges.
5. Security Deposit. None.
6. Use.
6.1 Use and Continuing Operating Covenant. The Premises may be used and occupied solely for ice
production and food processing and cold food storage or another legal use that is proposed in writing by Lessee and
accepted in writing by Lessor, in Lessor's sole and absolute discretion; provided, however, that Lessor shall not
unreasonably withhold, condition or delay its consent to a change of use with the same or more number of employees
and power consumption as has historically been used by Lessee. Lessee acknowledges that Lessor, in its role as the
City of Vernon, is implementing certain development plans within the City of Vernon, and has established certain
criteria for use of property within the City of Vernon, and that the Lessor does not intend to approve any use of the
Premises that does not comply with the City of Vernon's development plans and long term goals. Lessee shall not
use or permit the use of the Premises in a manner that does not comply with this Paragraph 6.1, or is unlawful,
creates damage, waste or a nuisance, or causes damage to neighboring premises or properties. Lessee acknowledges
and agrees that the primary value of this Lease to Lessor is based on the continuing operations and usage of the
entirety of the Premises for the purposes set forth in this Paragraph 6.1. Therefore, Lessee agrees to continually
maintain and operate the entire Premises for the purposes set forth herein during every business day of the Term, and
not to abandon, cease using, or change the usage (except with the written approval of Lessor as set forth above) of
any portion of the Premises, and to ensure that any subtenant or assignee complies with this covenant of continuing
operation, subject to reasonable interruptions for damage, destruction, or remodeling, and to additional short term
(not more than twenty (20) consecutive business days or thirty (30) non-consecutive business days in any 12 month
period) closures for other reasonable business purposes. In addition, any lender that acquires Lessee's interest in the
Premises shall not be required to operate the Premises; however, any successor to such lender shall be required to
comply with the foregoing provisions of this Paragraph 6.1, including the operating covenant.
6.2 Hazardous Substances.
(a) Reportable Uses Require Consent. The term "Hazardous Substance" as used in this Lease
shall mean any product, substance, or waste whose presence, use, manufacture, disposal, transportation, or release,
either by itself or in combination with other materials expected to be on the Premises, is either: (i) potentially
injurious to the public health, safety or welfare, the environment or the Premises, (ii) regulated or monitored by any
governmental authority, or (iii) a basis for potential liability to any governmental agency or third party under any
applicable statute or common law theory. Hazardous Substances shall include, but not be limited to, hydrocarbons,
petroleum, gasoline, and/or crude oil or any products, by-products or fractions thereof, and asbestos containing
materials. Except in connection with Lessee's permitted use (and provided that such action is taken in compliance
with all Applicable Requirements), Lessee shall not engage in any activity in or on the Premises which constitutes a
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. Reportable Use of Hazardous Substances without the exp&eSs prior JWTitten consent of Lessor and timely compliance
. 'at Lessee's expense) with all applicable laws, covenants., restrictions, regulations and ordinances ("Applkable
Reqwirements"). "Reportable Use" shall mean (i) the illlltallation'or use of any above or below ground storage
tank, (ii) the generation, possession, storage, use, transportation, or disposal of a Hazardous Substance that requires a
permit from, or with respect to which a report, notice, registration or business plan is required to be filed with, any
governmental authority, and/or (iii) the presence at the Premises of a Hazardous Substance with respect to which any
Applicable Requirements requires that a notice be given to persons entering or occupying the Premises or
neighboring properties. Notwithstanding the foregoing, Lessee may use any ordinary and customary materials
reasonably required to be used in the normal course of the Agreed Use, ordinary office supplies (copier toner, liquid
paper. glue. etc.) and conunon cleaning materials for food production and refrigeration uses (including, without
limitltion, ammonia), so long as such use is in compliance with all Applicable Requirements. In addition, Lessor
may condition its consent to any Reportable Use upon receiving such additional assurances as Lessor reasonably
deems necessary to protect itself. the public, the Premises and/or the environment against damage. contamination,
injuay and/or liability, including, but not limited to, the installation (and removal on or before Lease expiration or
termination) of protective modifications (such as concrete encasements).
(b) Duty to Inform Lessor. If Lessee knows. or has reasonable cause to believe, that a
Hazardous Substan~ has come to be located in, on, under or about the Premises after the Conunencement Date,
other than as previously consented to by Lessor, Lessee shall immediately give written notice of such fact to Lessor,
and provide Lessor with a copy of any report, notice. claim or other documentation which it has concerning the
presence of such Hazardous Substance.
(c) Lessee Remediation. Lessee shall not cause or permit any Hazardous Substance to be spilled
or released in, on, under. or about the Premises (including through the plumbing or sanitary sewer system) and shall
promptly, at Lessee's expense, comply with all Applicable Requirements and take all investigatory and/or remedial
action required by applicable law for the cleanup of any contamination of, and for the maintenance, security and/or
monitoring of the Premises as may be required as a result of the existence of any Hazardous Substance in, on, under.
or about the Premises other than Existing HazMat Conditions, or neighboring properties (provided, however. in the
case of neighboring properties, only to the extent that the contamination was caused or materially contributed to by
Lessee). The remediation shall be made as required under applicable laws.
(d) Lessee Indemuificatioo. Lessee shall indemnify, defend and hold Lessor, its elected officials
and employees and staff, lenders. consultants., and counsel, harmless from and against any and all loss of rents and/or
damages. liabilities, judgments, claims, expenses, penalties, and attorneys' and consultants' fees arising out of or
involving any Hazardous Substance located on the Premises (provided, however, that Lessee shall have no liability
under this Lease with respect to Existing HazMat Conditions or migration of any Hazardous Substance to the
Premises from adjacent properties not caused or contributed to by Lessee). Lessee's obligations shall include. but
not be limited to. the effects of any contamination or injury to person, property or the environment resulting from
Hazardous Substance on the Property. and the cost of investigation, removal, remediation, restoration and/or
abatement, and shall smvive the expiration or termination of this Lease. No termination. cancellation, or release
agreement entered into by Lessor and Lessee shall release Lessee from its obligations under this Lease with respect
to Hazardous Substances, unless specifically so agreed by Lessor in writing at the time of such agreement.
(e) Investigations and Remediation. Lessee shall be responsible for and pay for any
investigations or remediation measures required by governmental entities having jurisdiction with respect to the
existence of Hazardous Substances on the Premises during the Term except for any Existing HazMat Conditions or
migration of any Hazardous Substance to the Preniises from adjacent properties not caused or contributed to by
Lessee. Lessee shall cooperate fully in any such activities, including allowing Lessor and Lessor's agents to have
reasonable access to the Premises at reasonable times in order for Lessor to investigate and monitor any claims and
remediation activities; provided, however. that any such monitoring shall be at the sole option of Lessor. and shall
not negate or lessen Lessee's obligations hereunder.
6.3 Lessee's Compliance with Applicable Requirements. Lessee shall, at Lessee's sole expense. fully.
diligently and in a timely manner, materially comply with all Applicable Requirements (including, without
limitation, the Americans with Disabilities Act and all applicable environmental laws, except with respect to (a)
Existing HazMat Conditions, or (b) or migration of any Hazardous Substance to the Premises from adjacent
properties not caused or contributed to by Lessee), the requirements of any applicable fire insurance underwriter or
rating bureau. and the recommendations of Lessor's engineers and/or consultants which relate in any manner to the
such Requirements. without regard to whether such Requirements are now in effect or become effective after the
Commencement Date. Lessee shalL Within thirty (30) days after receipt of Lessor's written request. provide Lessor
with copies of all Permits and other documents. and other information reasonably evidencing Lessee's compliance
with any Applicable Requirements identified by Lessor. and shall promptly upon receipt, notify Lessor in writing
(with copies of any documents involved) of any threatened or actual claim, notice. citation. warning. complaint or
report pertaining to or involving the failure of Lessee or the Premises to comply with any Applicable Requirements.
7. Renovation of Building; Future Alterations.
7.\ The Existing Building. The Premises are presently improved with a Building of approximately
45,000 square feet. Lessee acknowledges hereby that it has researched and inspected the existing Building and other
improvements on the Premises and accepts the same in its present "as-is" condition. The Building, as it may be
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. renovated by Lessee, and as it may be further improved during the Toenn, shall be and remain the property ofLessor~
except as otherwise set forth in this Lease.. .
7.2 Initial Renovation by Lessee.
(a) Lessee shall use diligent efforts to obtain the Permits that are required for Lessee's renovation
of the Building for the use described in Paragraph 6.1, the terms and conditions of which shall be subject to Lessee's
review and approval in its sole discretion. If Lessee submits its application for the Pennits by February 1,2005, and
responds to all reasonable requests for further infonnation and documentation from the City of Vernon on a
reasonably timely basis, but the Permits are not obtained within one hundred and twenty (120) days after the
Execution Date, then Lessee shall have the right to terminate this Lease by delivering written notice to Lessor of
Lessee's intent to terminate within thirty (30) days after the passage of the 120 day period if the Permits are not
issued within such 30 day period.
(b) Following the issuance of the Permits, Lessee shall renovate the existing Building for use as an
ice production and food processing and cold storage facility at Lessee's sole cost and expense. The renovation shall
be perfonned in compliance with all applicable local, state, and federal codes, laws, rules, and requirements, and in
accordance with the working drawings that were submitted to the City of Vernon in connection with obtaining the
Permits (the "Working Drawings"), and in accordance with the Permits, and with first class materials and
worIcmanship. Lessee shall diligently prosecute the renovation to completion.
7.3 Future Alterations and Improvements. In addition to Lessee's obligation to renovate the Building
all set forth above, subject to Lessee's compliance with the provisions of Section 7 of this Lease, Lessee shall have
the right at any time and from time to time during the Term to make, at its sole cost and expense, such changes and
alterations, structural or otherwise, in or to the Building and Premises as Lessee shall deem necessary or desirable,
including, without limitation, the right to remove and/or demolish the Building and other improvements; provided,
however, that Lessee may not, without the prior written approval of Lessor, which shall not be unreasonably
withheld, demolish the Building (excluding trade fixtures and other Lessee personal property). The Parties agree that
it shall not be unreasonable for the Lessor to withhold or deny its approval if the effect of such removal or demolition
would be to materially reduce the value. of the Premises, unless Lessee constructs or causes to be constructed, a new
building and/or other improvements such that the value of the Premises after such construction would be (in Lessor's
reasonable estimation) at least equal to the value of the Premises as improved by the renovation to the Building
described in Paragraph 7.2 prior to s\lch removal and replacement. Without limiting Lessee's obligations related to
renovation or construction as set forth in this Lease, whenever Lessee requests Lessor's approval under this
Paragraph 7.6, Lessee sha1l provide to Lessor reasonable supportive evidence of Lessee's intent and capacity to
comply with its obligations pursuant to this Paragraph. Following preliminary approval thereof by Lessor, Lessee
sha1l provide plans, specifications, and working drawings (collectively, the "Plans'') for the repIacement
improvements prepared by a licensed architect and/or civil engineer, cost estimates for the construction of the
replacement improvements and reasonable evidence offinancial.capability to complete the replacement construction
as required by this Paragraph 7.6. Subject to delays caused by events of force majeure (with work to commence as
soon as reasonable after the end of the force majeure event), Lessee's failure to commence the construction of the
required replacement improvements approved by Lessor one hundred and eighty (180) days oftbe removal of said
Building or improvements to be replaced and/or to complete said work of replacement within two (2) years of the
commencement of such work: sha1l constitute a default by Lessee of its obligations under this Lease.
Notwithstanding the foregoing, Lessor's consent shall not be required for modifications to the Building that do not
affect the roof or structure or cost more than One Hundred Thousand Dollars (SIOO,OOO).
7.4 Requirements (or Renovation and Future Alterations and Improvements. The following terms
and provisioll$ shall apply to the renovations described in Paragraph 7.2 and to all future alterations or improvements
as described in Paragraph 7.3 above, and Lessee shall comply with each such requirement in connection with such
renovations or future improvements.
(a) Lessee shall deliver to Lessor (i) certificates of insurance evidencing coverage for "builder's
risk", (ii) evidence of worker's compensation insurance covering all persons employed in connection with the
renovation and with respect to whom death or bodily injury claims could be asserted against Lessor or the Premises
and (Hi) evidence that Lessee has paid or caused to be paid all premiums for the insurance coverages described in this
paragraph (b) and any increase in premiums on insurance required to be carried under Paragraph 9, sufficient to
assure maintenance of all insurance at sufficient levels during the renovation.
(b) Lessee shaIl payor cause to be paid the total cost and expense of all works of improvement, as
such phrase is defined in the Mechanic's Lien Law in effect at the time and place of the renovation when the work
begins. Lessee shall not suffer or permit to be enforced against the Premises, or any part thereof, any mechanic's,
materialman's, contractor's or subcontractor's lien arising from any work of improvement, regardless of cause.
However, Lessee may in good faith. and at Lessee's own expense, contest the validity of any such asserted lien,
claim or demand, provided that Lessee has finnished a bond freeing the Premises from the effect of such a lien claim.
(c) Lessee shall protect, defend and indemnify Lessor against all liability and loss of any type
arising out of the renovation or auy work of improvement performed on the Premises by Lessee, including reasonable
attorney's fees and all out of pocket costs and expenses incurred by Lessor in negotiating, settling, defending or
otherwise protecting against such claims.
(d) On completion of the renovation or any substantial work of improvement during the term of
this Lease, Lessee shall file or cause to be filed a Notice of Completion. Lessee hereby appoints Lessor as its
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0191010007112620.\
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attorney'ill fact to file the Notice of Completion on Lessee's failure to do so after the renovation or any work of
'improveme'nt has been substantially completed. . .
(e) On completion of the renovation, Lessee shall give Lessor a copy of the "as built" drawings, or
a marked set of the plans showing all field changes, reflecting all material changes to the Working Drawings.
Changes that do not materially alter the Working Drawings do not require inclusion in such drawings.
7.5 Prohibited Plans. Notwithstanding anything to the contrary expressed or implied herein, under no
circumstances shall the Plans consist of or include a new building, improvements to the Building, or other
improvements that are not permitted uses under Paragraph 6.1 hereof.
7.6 Grading and Site Preparation. Lessee shall not have the right to change the grade of the Premises.
to excavate and remove any underground obstructions and/or to demolish and remove any foliage and trees situated
upon the Premises as of the Execution Date without the prior written consent of Lessor, which consent shall not be
unreasonably withheld, conditioned or delayed. If the Lessor consents, all such work shall be performed in
accordance with the applicable requirements of this Lease and all applicable Laws.
7.7 Construction and Right to Improvements. Lessee may construct additional buildings and other
structures and improvements upon the Premises; provided that all such construction shall be performed in accordance
with the applicable requirements of this. Lease. Lessee covenants with Lessor that all improvements of whatsoever
oaIure constructed by or under Lessee on the Premises shall be diligently constructed at no cost or expense to Lessor
and in a good and workmanlike manner according to and in conformity with all applicable laws. Any and all such
improvements shall be owned by Lessee during the Term but shall remain a part of the Premises and be surrendered
therewith at the end of the Term hereof or sooner termination of this Lease, at which time the same shall become a
part of the realty and the absolute property of Lessor except as otherwise indicated in this Lease.
7.8 Cost and Expense of Improvements. The entire cost and expense of constructing any and all
improvements on the Premises shall be borne and paid by Lessee, and Lessee shall indemnify, hold and save Lessor
and the Premises harmless from any liability whatsoever on accoWlt thereof.
7.9 Ownership Of Improvements at Termination. All improvements (including the Building as
renovated by Lessee) on the Premises at the expiration of the Term or sooner termination of this Lease shall, without
compensation to Lessee, then become Lessor's property free and clear of all claims to or against them by Lessee or
any third person and Lessee shall defend and indemnify Lessor against all liability and loss (including reasonable
attorneys' fees and costs) arising from such claims against the Building or any other buildings or improvements on
the Premises. Notwithstanding the foregoing, however, all trade fixtures, furniture, equipment, inventory and signs
shall be and remain the property of Lessee and, without excusing Lessee's obligations under the provisions of
Paragraph 6.1, may be removable at any time during the term of this Lease, and, without excusing Lessee's
obligations under the provisions of Paragraph 6.1, Tenant shall have the right to remove any refrigeration. ice
manufacturing, packaging, handling, conveyors or other equipment or machinery installed or constructed by Lessee.
The removal of any such equipment, furniture, fixtures and signs shall be at Lessee's expense and Lessee shall repair
any damage to the Premises or any building or structure thereon occasioned by the removal. Lessee shall be required
to remove all such equipment, furniture, fixtures, and signs at the end of the Term or other earlier termination of this
Lease, and shall be required to remove any personal property, trade fixtures, or equipment required by law to be
removed from the Premises, , but shall not be required to remove any cabling and lor telecommunications lines.
8. Maintenance; Repairs. and Trade Fixtures.
8.1 Lessee's Obligations.
(a) In General. Except for Existing HazMat Conditions and/or or the migration of any Hazardous
Substance to the Premises from adjacent properties not caused or contributed to by Lessee, and subject to the
provisions of Paragraph 10 (Damage or Destruction), and 15 (Condemnation), Lessee shall, at Lessee's sole expense,
keep the Premises, in good order, condition and repair (whether or not the portion of the Premises requiring repairs.
or the means of repairing the same, are reasonably or readily accessible to Lessee, and whether or not the need for
such repairs occurs as a result of Lessee's use, any prior use, the elements or the age of such portion of the Premises),
including, but not limited to, all equipment or facilities, such as plwnbing, HV AC equipment, electrical, lighting
facilities, boilers, pressure vessels, ftre protection system, fixtures, walls (interior and exterior), foundations, ceilings,
roofs, roof drainage systems, floors, windows, doors, plate glass, skylights, landscaping, driveways, parking lots,
fences, retaining walls, signs, sidewalks and parkways located in, on, or adjacent to the Premises. Lessee, in keeping
the Premises in good order, condition and repair, shall exercise and perform good maintenance practices. Lessee's
obligations shall include restorations, replacements or renewals when necessary to keep the Premises and all
improvements thereon or a part thereof in good order, condition and state of repair. Lessee shall, during the term of
this Lease, keep the exterior appearance of the Building in a first-class condition (including, !<,g., graffiti removal)
consistent with the exterior appearance of other similar facilities of comparable age and size in the vicinity,
including, when necessary, the exterior repainting of the Building.
(b) Failure to Perform. If Lessee fails to perform Lessee's obligations under this Paragraph 8.1,
Lessor may enter upon the Premises after thirty (30) days' prior written notice to Lessee (except in the case of an
emergency, in which case no notice shall be required), perform such obligations on Lessee's behalf, and put the
Premises in good order, condition and repair, and Lessee shall promptly pay to Lessor a sum equal to 110010 of the
cost thereof; provided, however, that if such cure reasonably requires more than thirty (30) days, then Lessor shall
not take any action if Lessee begins such work within thirty (30) days after receipt of notice and thereafter diligently
prosecutes it to completion.
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0191010007112620.1
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8.2. Lessor's Obligations. Except for Existing HazMllt Conditions and/or or the migration of anY'
Razantous Substance to the Premises from adjacent propertie6 not caused or contributed to by Lessee, and subject to
lheprovisions of Paragraphs 10 (Damage or Destruction) and 15 (Con&mnation), it is intended by the Parties hereto
that Lessor have no obligation, in any manner whatsoever, to repair and maintain the Premises, or the equipment
therein, all of which obligations are intended to be that of the Lessee. It is the intention of the Parties that the terms
of this Lease govern the respective obligations of the Parties as to maintenance and repair of the Premises, and they
expressly waive the benefit of any statute now or hereafter in effect to the extent it is inconsistent with the terms of
this Lease.
8.3 Surrender; Restoration. Subject to Paragraphs 10 (Damage or Destruction) and 15 (Condemnation),
Lessee shall surrender the Premises by the Expiration Date or any earlier tennination date, with all of the
improvements, parts and surfaces thereofbroom clean and free of debris, and in good operating order, condition and
state of repair, ordinary wear and tear excepted. "Ordinary wear and tear" shall not include any damage or
deterioration that would have been prevented by good maintenance practice. Lessee shall completely remove from
Ibe Premises any and all Hazardous Substances brought onto the Premises by or for Lessee, or any third party under
Lessee's control (except Hazardous Substances which were deposited via underground migration from areas outside
oflbe Premises, unless such underground migration was related to conduct of Lessee) to the extent required by
applicable law. Any personal property of Lessee not removed on or before the Expiration Date or any earlier
termination date shall be deemed to have been abandoned by Lessee and may be disposed of or retained by Lessor as
Lessor may desire, and Lessee shall pay the cost of the removal, storage, and disposal.
9; Insurance; Indemnity.
9.1 Payment For Insurance. Lessee shall pay for all insurance required hereunder, commencing with
Ibe Execution Date and ending on the Expiration Date or sooner termination of this Lease.
9.2 Liability Insurance.
(a) Carried by Lessee. Lessee shall obtain and keep in force a Commercial General Liability
policy of insurance protecting Lessee and Lessor as an additional insured against claims for bodily injury, personal
injury and property damage based upon or arising out of the ownership, use, occupancy or maintenance of the
Premises and all areas appurtenant thereto. Such insurance shall be on an occurrence basis providing single limit
coverage in an amount not less than $~,OOO,OOO per occurrence with an annual aggregate of not less than $5,000,000,
an . "Additional Insured-Managers or Lessors of Premises Endorsement" and contain the "Amendment of the
PoUution Exclusion Endorsement" for damage caused by heat, smoke or fumes from a hostile fire. The policy shall
not contain any intra-insured exclusions as between insured persons or organizations, but shall include coverage for
liability assumed under this Lease as an "insured contract" for the perfonnance of Lessee's indemnity obligations
under this Lease. The limits of said insurance shall not, however, limit the liability of Lessee nor relieve Lessee of
any obligation hereunder. All insurance carried by Lessee shall be primary to and not contributory with any similar
insurance carried by Lessor, whose insurance shall be considered excess insurance only.
(b) Carried by Lessor. Lessor, at its sole expense, shall maintain liability insurance as described
in Paragraph 9.2(a), in addition to, and not in lieu ot the insurance required to be maintained by Lessee. Lessee shall
not be named as an additional insured therein.
9.3 Property Insurance - BlIiIdiog, improvements and Rental Value.
(a) Building and Improvements. Lessee shall obtain and keep in force a policy or policies in the
name of Lessee and Lessor, with loss payable to Lessee insuring loss or damage to the Premises. The amount of
such insurance shall be equal to the full replacement cost of all of the improvements on the Premises, as the same
shall exist from time to time,. Such policy or policies shall insure against all risks of direct physical loss or damage
(except the perils of flood and/or earthquake), including coverage for debris removal and the enforcement of any
Applicable Requirements requiring the upgrading, demolition, reconstruction or rep1acement of any portion of the
improvements on the Premises as the result of a covered loss. Said policy or policies shall also contain an agreed
valuation provision in lieu of any coinsurance clause, waiver of subrogation, and inflation guard protection causing
an increase in the annual property insurance coverage amount by a factor of not less than the adjusted U.S.
Department of Labor Consumer Price index for All Urban Consumers for the city nearest to where the Premises are
located. If such insurance coverage has a deductible clause, the deductible amount shall not exceed $5, 000 per
occurrence, and Lessee shall be liable for such deductible amount in the event of an insured Loss.
(b) Rental Value. Lessee shall obtain and keep in force a policy or policies in the name of Lessee
and Lessor with loss payable to Lessor insuring the loss of the full Rent for one year with an extended period of
indemnity for an additional 180 days ('~Rental Value insurance"). Said insurance shall contain an agreed valuation
provision in lieu of any coinsurance clause, and the amount of coverage shall be adjusted annually to reflect the
projected Rent otherwise payable by Lessee for the next 12 month period. Lessee shall be liable for any deductible
amount in the event of such loss.
(e) Builder's Risk Coverage. Before commencement of any demolition or construction at the
Premises, Lessee shall procure,.and shall maintain or cause to be procured and maintained in force until completion
of all works of improvement at the Premises, "all risks" builder's risk insurance, including vandalism and malicious
mischief, with limits in the total amount of the construction and the value of all improvements.
9.4 Lessee's Property; Business Interruption Insurance.
(a) Property Damage. Lessee shall obtain and maintain insurance coverage on all of Lessee's
=- T_ F~ mv~ummoo::- ~ i_~1 re M'ZJs
0191c.ooo7 112620.1
. COYel1ge' with a deductible of not to exceed $5,000 per occummce. Subject to Paragraph 10 (Damage and-
1blmction), the proceeds from any such insurance shall. be used by Lessee for the replacement of Lessee's
equipment, Trade Fixtures, inventory and other personal proJh.~. Les'see shall provide Lessor with written evidence
flat such insurance is in force.
(b) Business Interruption. Lessee shall obtain and maintain loss of income and extra expense
insurance in amounts as will reimburse Lessee for direct or indirect loss of earnings attributable to all perils
commonly insured against by prudent lessees in the business of Lessee or attributable to prevention of access to the
Premises as a result of such perils.
(e) No Representation of Adequate Coverage. Lessor makes no representation that the limits or
fixms of coverage of insurance specified herein are adequate to cover Lessee's property, business operations or
ebIig:IIiODS under this Lease.
9.S Insurance Policies. Insurance required herein shall be by companies duly licensed or admitted to
flaDsact business in the state where the Premises are located, and maintaining during the policy tenn a "General
Policyholders Rating" of at least B+, V, as set forth in the most current issue of "Best's Insurance Guide". Lessee
sIaaJ1 not do or pennit to be done anything which invalidates the required insurance policies. Lessee shall, on or
Wore the Execution Commencement Date, deliver to Lessor certified copies of policies of such insurance or
certificates evidencing the existence and amounts of the required insurance. No such policy shall be cancelable or
SliJject to modification except after 30 days prior written notice to Lessor. Lessee shall, at least 30 days prior to the
czpiration of such policies, furnish Lessor with evidence of renewals or "insurance binders" evidencing renewal
dlcreot: or Lessor may order such insurance and charge the cost thereof to Lessee, which amount shall be payable by
Lcsscc to Lessor upon demand Such policies shall be for a tenn of at least one year, or the length of the remaining
lam of this Lease, whichever is less.
9.6 Waiver of Subrogation. Without affecting any other rights or remedies, Lessee and Lessor each
Iaeby release and relieve the other, and waive their entire right to recover damages against the other, for loss ofor
iIrnage to its property arising out of or incident to the perils required to be insured against herein. The effect of such
tdeases and waivers is not limited by the amount of insurance carried or required, or by any deductibles applicable
hereto. The Parties agree to have their respective property damage insurance carriers waive any right to subrogation
flat such companies may have against Lessor or Lessee, as the case may be, so long as the insurance is not
iIIvalidated thereby and is available Oft commercially reasonable terms.
9.7 Indemoity. Lessee shall indemnify, protect, defend and hold harmless the Premises, Lessor and its
elected officials, staff: employees, agents and representatives, from and against any and all claims, damages, · liens,
judgments, penalties, attorneys' and consultants' fees, expenses and/or liabilities arising out of, involving, or in
c:aanection with, the use and/or occupancy of the Premises by Lessee. If any action or proceeding is brought against
Lessor by reason of any of the foregoing matters, Lessee shall upon notice defend the same at Lessee's expense by
counsel reasonably satisfactory to Lessor and Lessor shall cooperate with Lessee in such defense. Lessor need not
lIave first paid any such claim in order to be defended or indemnified.
9.8 Exemption of Lessor from Liability. Lessor shall not be liable for injury or damage to the person or
pods, wares, merchandise or other property of Lessee, Lessee's employees, contractors. invitee$, customers, or any
od1er person in or about the Premises, regardless of cause or whether or not such injury or damage results from
cmditions arising from the Premises or from other sources or places. Notwithstanding Lessor's negligence or breach
of this Lease, Lessor sha1l under no circumstances be liable for injury to Lessee's business or for any loss of income
or profit therefrom.
9.9 Fallun to Provide Insurance. Lessee acknowledges that any failme on its part to obtain or maintain
Ihc insurance required herein will expose Lessor to risks and potentially cause Lessor to incur costs not contemplated
by this Lease. If Lessee shall fail to procure and maintain the insurance required to be carried by it, Lessor may, but
slaaIl not be required to, procure and maintain the same. Accordingly, for any failme by Lessee to maintain the
required insurance and/or provide Lessor with the required binders or certificates evidencing the existence of the
required insurance or to promptly reimburse Lessor for the cost of any insurance purchased by it after Lessee's
failure to maintain the same, shall constitute a Default and/or Breach of this Lease by Lessee. If Lessor obtains such
insurance for the benefit of Lessee, Lessee shall pay to Lessor 110"10 of the amount of the premium.
10. Damage or Destruction.
10.1 Lessee Restoration Oblil!ation. Subject to the provisions of Paragraph 10.4 below, if at any time
during the Term, the Premises or any part thereof shall be damaged or destroyed by fire, flood, vandalism,
earthquake or other casualty of any kind or nature, Lessee shall proceed promptly and with due diligence to repair,
replace or rebuild the Premises as nearly as possible to their condition and character immediately prior to such
damage with such variations and alterations requested by Lessee as may be approved in writing by Lessor.
10.2 Insurance Proceeds. All insurance proceeds payable to Lessee (except insurance proceeds payable to
Lessor on account of Lessor's loss of Rents proceeds per the insurance carried by Lessee) at any time as a result of
casualty to the Premises shall be 'paid jointly to Lessor and Lessee, but shall be used solely for purposes of payment
for the cost of restoring the Premises, except as may be otherwise expressly set forth herein, and advanced from time
to time for such purposes as the restoration work progresses upon certified request of Lessee's architect Lessor and
Lessee shall cooperate in order to obtain the largest possible insurance award lawfully obtainable and shall execute
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0191MlOO7 112620.1
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. any and 'aU consents and other instruments and take all other actions necessary or desirable in order to effectuate>.
same and tei ca\Jse such proceeds to be paid as herein before provided. .
\03 No Lease Termination. Except as provided in ParagraPh lOA, this Lease shall not be affected in any
manner by reason of the total or partial destruction of the Premises or any part thereof, or any reason whatsoever, and
Lessee, notwithstanding any applicable law, present or future, waives all rights to quit or surrender the Premises, or
any part thereof, including, but not limited to, Lessee's rights \mder California Civil Code Sections 1932(2) and
1933(4). Base Rent and Additional Rent required to be paid by Lessee here\mder shall not abate as a result of any
casualty or destruction.
10.4 Uninsured Casualty. Lessee is relieved of the obligation to, but may, at its option, repair, restore or
reconstruct the Building damaged or destroyed during the final five (5) years of the Term (including any option
period then in effect) if (a) the work of repairing. restoring, or reconstructing would exceed the lesser of reo percent
(10%) of the replacement cost of the damaged or destroyed Building prior to such damage or destruction or fifty
percent (500/0) of the Base Rent during the balance of the Tenn; (b) the damage or destruction is \minsured and is not
required to be insured under this Lease; and (c) Lessee complies with all the following conditions:
(i) Lessee must deliver to Lessor notice of the damage or destruction promptly but not
later than sixty (60) days after the event, detailing facts that qualify the casualty under this section.
(ii) Lessee must continue to make all Rent and other payments when due as required by
this Lease, through the termination date.
I t. Real Property Taxes.
11.I Definition. As used herein, the term "Real Property Taxes" shall include any form of assessment;
real estate, general, special, ordinary or extraordinary, or rental levy or tax (other than inheritance, personal income
or estate taxes); improvement bond; and/or license fee imposed upon or levied against any legal or equitable interest
of Lessor in the Premises, Lessor's right to other income therefrom, and/or Lessor's business of leasing, by any
authority having the direct or indirect power to tax and where the funds are generated with reference to the common
address of the Premises and where the proceeds so generated are to be applied by the city, county or other local
taxing authority of a jurisdiction within which the Premises are located. Real Property Taxes shall also include any
tax, fee, levy, assessment or charge, or any increase therein: (i) imposed by reason of events occurring during the
term of this Lease, including but not 1jmited to, a change in the ownership of the Premises, and (ii) levied or assessed
011 improvements to the Premises during the term of this Lease.
11.2 Paymeat of Taxes. In addition to Base Rent, Lessee sball pay each Real Property Tax insta1Imcot
prior to the applicable delinquency date. If any such installment sball cover any period of time prior to or after the
expiration or termination of this Lease, Lessee's share of such installment shall be prorated.
113 Personal Property Taxes. Lessee shall pay, prior to delinquency, all taxes assessed against and
levied upon Lessee's Trade Fixtures, furnishings, equipment and all personal property of Lessee.
12. Utilities and Sernces. Lessee shall pay for all water, gas, heat, light, power, telephone, trash disposal and
other utilities and services supplied to the Premises, together with any taxes thereon. There shall be no abatement of
rent and Lessor shall not be liable in any respect whatsoever for the inadequacy,. stoppage, interruption or
discontinuance of any utility or service due to riot, strike, labor dispute, breakdown, accident, repair or other cause
beyond Lessor's reasonable control or in cooperation with governmental request or directions.
13. Assignment and Sablettiug.
13.1 Lesson Consent Required.
Ca) Lessee shall not voluntarily or by operation of law assign, transfer, mortgage or encumber
(collectively, "assign or assignment") or sublet all or any part of Lessee's interest in this Lease or in the Premises
without Lessor's prior written consent which consent Lessor agrees shall not be unreasonably delayed, conditioned or
withheld. Notwithstanding the preceding sentence, Lessee hereby acknowledges and agrees that Lessor may, in its
sole and absolute discretion. withhold consent if the assignee or subtenant inreods to use the Premises for a use that is
not the use described in Paragraph 6.1.
(bl A change in the control of Lessee shall constitute an assignment requiring consent. The
transfer, on a cumulative basis, of 49% or more of the voting control of Lessee shall constitute a change in control for
this purpose. Lessor shall approve (i) an assignment of this Lease to an affiliate of Lessee who, in Lessor's
reasonable judgment, , is sufficiently creditworthy to maintain its obligations under this Lease and (ii)a change in
control of Lessee so long as following the change in control, Lessee remains sufficiently creditworthy to maintain its
obligations under this Lease, so long as, in each case, Lessor is given at least 20 days' prior writteII notice of the
assignment, and, in the case of an assignment to an affiliate, the affiliate executes a commercially reasonable
assignment and assumption agreement, and in either event, there is no change in the use of the Premises. A change
of control or assignment to an affiliate as described in this Paragraph shall be referred to as an "Affiliate
Assignment",
Cel An assignment or subletting without consent shall be null and void, and of no force and effect,
and shall constitute a Breach of this Lease. .
Cd) Lessee's remedy for any breach of this Paragraph 13.1 by Lessor shall be limited to
compensatory damages or injunctive relief.
13.2 Terms and Conditions Applicable to Assignment and Subletting.
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0191010007112620.1
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'. (a) Regardless of Lessor's consent, no &ubletting,shall: (i) be effective without the express writteQ.
"assumption' by such sublessee of the obligations of Lessee pnder this Lease, (ii) release Lessee of any obligations
hereunder, or (iii) alter the primary liability of Lessee for the paymetlt of Rent or for the performance of any other
obligations to be performed by Lessee. No assignment shall be effective without Lessor's consent and the express
written assumption by such assignee of the obligations of Lessee under this Lease. Upon an assignment, Lessee shall
not have any further rights, obligations or liabilities under this Lease.
(b) Lessor may accept Rent or performance of Lessee's obligations from any person other than
Lessee pending approval or disapproval of an assignment
(e) Lessor's consent to any assignment or subletting shall not constitute a consent to any
subsequent assignment or subletting.
(d) In the event of any Default or Breach by Lessee, Lessor may proceed directly against Lessee
or anyone else responsible for the perfonnance of Lessee's obligations under this Lease, including any sublessee,
without first exhausting Lessor's remedies against any other person or entity responsible therefor to Lessor, or any
security held by Lessor.
(e) Each request for consent to an assignment or subletting shall be in writing, accompanied by
infonnation relevant to Lessor's determination as to the financial and operational teSpOfiS1bility and appropriateness
of the proposed assignee or sublessee, including but not limited to the intended use and/or required modification of
the Premises, if any, together with a fee of $1,500 as consideration for Lessor's considering and processing said
request. Lessee agrees to provide Lessor with such other or additional infonnation and/or documentation as may be
reasonably requested by Lessor in writing within ten (10) days.
. 13.3 Any assignee of, or sublessee under, this Lease shall, by reason of accepting such assigmnent or
entering into such sublease, be deemed to have assumed and agreed to conform and comply with each and every
term, covenant, condition and obligation herein to be obselVed or performed by Lessee during the term of said
assignment or sublease, other than such obligations as are contrary to or inconsistent with provisions of an
assignment or sublease to which Lessor has specifically consented to in writing.
14. Default; Breach; Remedies.
14.1 Default; Breach. A "Default" is defined as a failure by the Lessee to comply with or perform any of
the terms, covenants, or conditions uhder this Lease. A "Breach" is defined as the occurrence of one or more of the
following Defaults, and the failure of Lessee to cure such Default within any applicable grace period:
(a) Using any portion of the Premises for pwposes or on terms other than those set forth in
Paragraph 6.1.
(b) The failure of Lessee to make any payment of Rent required to be made by Lessee hereunder
when due, to provide reasonable evidence of insurance or to fulfill any obligation under this Lease which thereby
endangers or threatens life or property, where such failure continues for a period of five (5) days following written
notice to Lessee.
(e) The failure by Lessee to provide (i) reasonable written evidence of compliance with
Applicable Requirements, (ii) the rescission of an unauthorized assignment or subletting, or (ill) an Estoppel
Certificate where any such failure continues for a period of 30 days following written notice to Lessee.
(d) A Default by Lessee as to the terms, covenants, conditions or provisions of this Lease. other
than those described in subparagraphs 14.1(a), (b) or (c), above, where such Default continues for a period of30 days
after written notice; provided, however, that if the nature of Lessee's Default is such that more than 30 days are
reasonably required for its cure, then it sbaIl not be deemed to be a Breach if Lessee commences such cure within
said 30 day period and thereafter diligently prosecutes such cure to completion.
(e) The occurrence of any of the foIlowing events: (i) the making of any general arrangement or
assignment for the benefit of creditors; (ii) becoming a "debtor" as defined in II U.s.C. ~IOl or any successor
statute thereto (unless, in the case of a petition filed against Lessee, the same is dismissed within 90 days); (ill) the
appointment of a trustee or receiver to take possession of substantially all of Lessee's assets located at the Premises
or of Lessee's interest in this Lease, where possession is not restored to Lessee within 60 days; or (iv) the attachment,
execution or other judicial seizure of substantially all of Lessee's assets located at the Premises or of Lessee's interest
in this Lease, where such seizure is not discharged within 60 days; provided, however, in the event that any provision
of this subparagraph (e) is contrary to any applicable law, such provision shall be of no force or effect, and not affect
the validity of the remaining provisions.
(f) The discovery .that any finanoial statement of Lessee given to LesSor was materially false;
provided, however, that any. such claim must be asserted by Lessor within twelve (12) months after receipt of such
financial statement by Lessor or it shaIl be deemed waived.
14.2 Remedies. If Lessee fails to perform any of its duties or obligations when due or within ten (10) days
thereafter (or such longer cure period as may be specified above in Paragraph 14.1) upon written notice (or in case of
an emergency, without notice), Lessor may, at its option, perform such duty or obligation on Lessee's behalf,
including but not limited to the.obtaining of reasonably required bonds, insurance policies, or governmental licenses,
permits or approvals. Lessee shall pay to Lessor an amount equal to 110% of the actual, documented costs and
expenses incurred by Lessor in such performance upon receipt of an invoice therefor. In the event of a Breach,
Lessor may, with or without further notice or demand, and without limiting Lessor in the exercise of any right or
remedy which Lessor may have by reason of such Breach:
Page 10 of 16
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0191010001112620.1
'. (a) Terminate Lessee's right to possession of thi: Premises by any lawful means, in which case.
. tiIase shall terminate and Lessee shall immediately Sl11TeJl.der possession to Lessor. In such event Lessor shall be
-.r to recover from Lessee: (i) the unpaid Rent which bad been earned at the time of termination; (ii) the worth
"time of award of the amount by which the unpaid rent which would have been earned after termination until
AdIIe of award exceeds the amount of such rental loss that the Lessee proves could have been reasonably avoided;
tiiI6e worth at the time of award of the amount by which the unpaid rent for the balance of the term after the time
....d exceeds the amount of such rental loss that the Lessee proves could be reasonably avoided; and (iv) any
"amount necessary to compensate Lessor for all the detriment proximately caused by the Lessee's failure to
flIian its obligations under this Lease or which in the ordinary course of things would be likely to result therefrom,
illling but not limited to the cost of recovering possession of the Premises, expenses of reletting, including
~ renovation and alteration of the Premises, reasonable attorneys' fees, and that portion of any leasing
-.ission paid by Lessor in connection with this Lease applicable to the unexpired term of this Lease. The worth
.. time of award of the amount referred to in provision (iii) of the inunediately preceding sentence shall be
-..red by discounting such amount at the discount rate of the Federal Reserve Bank of the District within which
fdmnises are located at the time of award plus one percent. Efforts by Lessor to mitigate damages caused by
"'s Breach of this Lease shall not waive Lessor's right to recover damages under Paragraph 13. If termination
... Lease is obtained through. the provisional remedy of unlawful detainer, Lessor shall have the right to recover
it_ proceeding any unpaid Rent and damages as are recoverable therein, or Lessor. may reserve the right to
-.. all or any part thereof in a separate suit. If a notice and grace period required under Paragraph 14.1 was not
flllilusly given, a notice to pay rent or quit, or to perform or quit given to Lessee under the unIawfuldetainer statute
..also constitute the notice required by Paragraph 14.1. In such case, the applicable grace period required by
'-waph 14.1 and the unlawful detainer statute shall run concurrently, and the failure of Lessee to cure the Default
1iilIia the greater of the two such grace periods shall constitute both an unlawful detainer and a Breach of this Lease
IIIIiIIiag Lessor to the remedies provided for in this Lease and/or by said statute.
(b) Continue the Lease and Lessee's right to possession and recover the Rent as it becomes due, in
... event Lessee may sublet or assign, subject only to reasonable limitations. Acts of maintenance, efforts to relet,
.... the appointment of a receiver to protect the Lessor's interests, shall not constitute a termination of the
u.e's right to possession. ,
(c) Pursue any other remedy now or hereafter available under the laws or judicial decisions of the
_wherein the Premises are located. The expiration or termination of this Lease and/or the termination of Lessee's
..m possession shall not relieve Lessee from liability under any indemnity provisions of this Lease as to matters
-nng or accruing during the term hereof or by reason of Lessee's occupancy of the Premises.
143 Late Charges. Lessee hereby acknowledges that late payment by Lessee of Rent will cause Lessor to
_costs not contemplated by this Lease, the exact amount of which will be extremely difficult to ascertain. Such
- include, but are not limited to, processing and accounting charges, and late charges which may be imposed
... Lessor by any Lender. Accordingly, if any Rent shall nofbe received by Lessor within five (5) days after such
~ shall be due, then, without any requirement for notice to Lessee, Lessee shall immediately pay to Lessor a
-'me late charge equaI to five percent (5%) of each such overdue amount or $100, whichever is greater. The
IIIIIi:s hereby agree that such late charge represents a fair and reasonable estimate of the costs Lessor will inCltt by
- of such late payment Acceptance of such late charge by Lessor shall in no event constitute a waiver of
'-e's Default or Breach with respect to such overdue ammmt, nor prevent the exercise of any of the other rights
"laDedies granted hereunder. In the event that a late charge is payable hereunder, whether or not collected, for
.. (3) consecutive installments of Base Rent, then notwithstanding any provision of this Lease to the contrary,
.. Rent shall, at Lessor's option, become due and payable quarterly in advance for twenty-four (24) months.
14.4 Interest. Any monetary payment due Lessor hereunder, other than late charges, not received by
baor, when due or within 10 days following the date on which it was due, shall bear interest from the I I rh day after
-.s due. The interest ("Interest'') charged shall be computed at the lesser of 10% per annum or the maximum rate
dIwed by law. Interest is payable in addition to the potential late charge provided for in Paragraph 14.3, but interest
.. not be payable on any late charge or other penalty.
14.5 Breach by Lessor. Lessor shall not be deemed in breach of this Lease unless Lessor fails within a
"l11able time to perform an obligation required to be performed by Lessor. For purposes of this Paragraph, a
-.onable time shall in no event be less than 30 days after receipt by Lessor (unless a shorter or longer period is
..med in this Lease for the applicable obligation), and any Lender whose name and address shall have been
finished Lessee in writing for such purpose, of written notice specitying wherein such obligation of Lessor has not
- performed; provided, however, that if the nature of Lessor's obligation is such that more than 30 days are
a:asonably required for its performance, then Lessor shall not be in breach if performance is commenced within such
]lday period and thereafter diligently pursued to completion. '
15. Condemnation. If the Premises or any portion thereof are taken under the power of eminent domain or sold
IIIIer the threat of the exercise of said power (collectively "Condemnation"), this Lease shall terminate as to the
pIlt taken as of the date the condemning authority takes title or possession. whichever first occurs. If more than ten
pcn:ent (10"10) of the Premises is taken by Condemnation, Lessee may, at Lessee's option, to be exercised in writing
1riIhin ten (10) business days after Lessor shall have given Lessee written notice of such taking (or in the absence of
.. notice, within ten (IO) business days after the condemning authority shall have taken possession) terminate this
:~~fu'_~~~'-~~h:I~OO 1f~-~7fi~__
8I9lIIIOOO7 112620.1
. .
. accordanc,e with the foregoing, this Lease shall remain in full fotce and effect as to the portion of the Premis<$
'mmaining, "except that the Base Rent shall be reduced in proportion to the reduction in utility of the Premises cauSed
by such Condemnation. Condemnation awards and/or payments shall be the property of both Lessor and Lessee,
depending on whether such award shall be made as compensation for diminution in value of the leasehold, the value
of the improvements which are taken and the value of the part taken, and for severance damages; provided, however,
that in all cases Lessee shall be entitled to any compensation for Lessee's relocation expenses, loss of business
goodwill and/or Trade Fixtures, without regard to whether or not this Lease is tenninated pursuant to the provisions
of this Paragraph. All improvements on the Premises including fixtures and Trade Fixtures, made to the Premises by
Lessee shall be considered the property of the Lessee and Lessee shall be entitled to any and all compensation which
is payable therefor. In the event that this Lease is not tenninated by reason of the Condemnation, Lessee shall repair
any damage to the Premises caused by such Condemnation. To the maximwn extent permitted by law, Lessor hereby
waives its right to condemn all or any portion of the Premises or Lessee's interest therein.
16. No Broker or FiDder Fees. Each Party hereto (a) represents and warrants to the other Party that such Party
bas not engaged or involved a broker or a finder in connection with this Lease that would be entitled to a brokerage
or finder.'s fee in connection with the consummation of this Lease and (b) hereby agrees to protect, defend and
iodcmnify the other Party from all claims, demands, damages and liabilities, including court costs and reasonable
attorneys' fees in the event of any breach or such representation and warranty.
\7. Estoppel Certificates.
(8) Each Party (as "Respondiog Party") shall within ten (10) business days after receipt of
written notice from the other Party (the "Requesting Party") execute, acknowledge and deliver to the Requesting
Party a statement in writing in form similar to the then most current "Estoppel Certificate" form published by the
American Industrial Real Estate Association.
(b) If the Responding Party shall fail to execute or deliver the Estoppel Certificate within such ten
(10) business day period, the Requesting Party may execute an Estoppel Certificate stating that: (i) the Lease is in full
force and effect without modification except as may be represented by the Requesting Party, (ii) there are no uncured
defaults in the Requesting Party's performance, and (iii) if Lessor is the Requesting Party, not more than one month's
rent has been paid in advance. Prospective purchasers and encwnbrancers may rely upon the Requesting Party's
Estoppel Certificate, and the Responding Party shall be estopped from denying the truth of the facts contained in said
Certificate.
(c) If Lessor desires to finance, refinance, or sell the Premises, or any part thereof, Lessee shall
deliver to any potential lender or purchaser designated by Lessor such financial statements as may be reasonably
required by such lender or purchaser, including but not limited to Lessee's financial statements for the past 3 years.
All such financial statements shall be received by Lessor and such lender or purchaser in confidence and shall be
used only for the purposes herein set forth.
\8. Definitioo of Lessor. The term "Lessor" as used herein shall mean the owner or owners at the time in
question of the fee title to the Premises. In the event of a transfer by the Lessor, the prior Lessor shall be relieved of
alI. liability with respect to the obligations and/or covenants under this Lease thereafter to be performed by the
Lessor. Subject to the foregoing, the obligations and/or covenants in this Lease to be performed by the Lessor shaIl
be binding only upon the Lessor as hereinabove defined.
19. Severability. The invalidity of any proviSion of this Lease, as determined by a court of competent
jurisdiction. shall in no way affect the validity of any other provision hereof, all of which provisions shall remain in
full force and effect The invalid provision shall be limited to the extent required in order to make it valid and
enforceable, and if necessary, severed from this Lease
20. Days. Unless otherwise specifically indicated to the contrary, the word "days" as used in this Lease shall
mean and refer to calendar days.
21. Limitation 00 Liability. The obligations of Lessor under this Lease shall not constitute personal obligations
of Lessor or its elected officials, staff, employees, or agents, and the liability of Lessor for any default by Lessor
Wlder this Lease or arising in connection herewith shall be limited solely and eXClusively to an amount which is equal
to the interest of Lessor in the Premises or the proceeds from the sale thereof. Neither Lessor, nor any of Lessor's
elected officials, staff, employees, agents, or attorneys shall have any personal liability therefor, and Lessee hereby
expressly waives and releases such personal liability on behalf of itself and of all persons claiming by, through, or
Wlder Lessee. Neither Lessor nor any of Lessor's elected officials, staff, employees, agents, or attorneys shall be
liable under any circumstances for injury or damage to, or interference with, Lessor's business, including, but riot
limited to,loss of profits, loss of revenues, loss of business opportunity, loss of goodwill, or loss of use, in each case,
however occurring.
22. Time of Esseoce. Time is of the essence with respect to the performance of au obligations to be performed
or observed by the Parties under this Lease.
23. Notices.
23.\ Notice Requirements. All notices required or permitted by this Lease or applicable law shall be in
:ting "'" may '" ""livered in""""" (by Imnd 0' by..::~: - '" - by re"""'. """.00 '" F~
0191010007 112620.1
.
. .
. orOlallight courier, with postage prepaid, or by facsimile transmiesion, and shall be deemed sufficiently given if.
'senaI in a inanner specified in this Paragraph 23. The addresses noted adjacent to a Party's signature on this LeaSe
Mile that Party's address for delivery or mailing of notices'. Eilher Party may by written notice to the other
spcarya different address for notice, except that upon Lessee's taking possession of the Premises, the Premises shall
~ Lessee's address for notice. A copy of all notices to Lessor shall be concurrently transmitted to such party
orpmies at such addresses as Lessor may from time to time hereafter designate in writing.
23.2 Date of Notice. Any notice sent by registered or certified mail, return receipt requested, shall be
da:mcd given on the date of delivery shown on the receipt card, or if no delivery date is shown, the postmark
Ihcmoo, if sent by regular mail the notice shall be deemed given 72 hours after the same is addressed as required
la:iIIand mailed with postage prepaid. Notices delivered by overnight courier shall be deemed given on the date of
dc:Iiway or the date that delivCl)' is refused. Notices transmitted by facsimile transmission shall be deemed delivered
..-telephone confinnation of receipt (confinnation report from fax machine is sufficient), provided that they are
a..itted on a business day and a copy is also delivered via delivery or mail. If notice is received on a Saturday,
s.layor legal holiday, it shall be deemed received on the next business day.
24. Waivers. No waiver by Lessor of the Default or Breach of any tenD, covenant or condition hereof by Lessee,
shall lie deemed a waiver.of any other term, covenant or condition hereof, or of any subsequent Default or Breach by
Lcsscc of the same or of any other term. covenant or condition hereof. Lessor's consent to, or approval of, any act
shaIIlM)t be deemed to render unnecessary the obtaining of Lessor's consent to, or approval of, any subsequent or
similar act by Lessee, or be construed as the basis of an estoppel to enforce the provision or provisions of this Lease
~g such consent. The acceptance of Rent by Lessor shall not be a waiver of any Default or Breach by Lessee.
Any payment by Lessee may be accepted by Lessor on account of moneys or damages due Lessor, notwithstanding
any qualifying statements or conditions made by Lessee in connection therewith, which such statements and/or
CODdiIions shall be of no force or effect whatsoever unless specifically agreed to in writing by Lessor at or before the
time of deposit of such payment.
25. No Right To Holdover. Lessee has no right to retain possession of the Premises or any part thereof beyond
the expiration or termination of this Lease. In the event that Lessee holds over, then Lessee shall be a tenant at
sutIaance on a month to month basis. and the Base Rent shall be increased to 125% of the Base Rent applicable
immediately preceding the expiration'or termination, and Lessee shall comply with all other terms and provisions of
this Lease. Nothing contained herein sbal1 be construed as consent by Lessor to any hoIding over by Lessee. and
LcsscIF expressly reserves the right to require Lessee to surrender possession of the Premises to Lessor as provided in
this Lease upon the expiration or earlier termination of this Lease. The provisions of this Paragraph 25 shall not be
dcancd to limit or constitute a waiver of any other rights or remedies of Lessor provided herein or in law or at
equity. If Lessee fails to surrender the Premises upon the termination or expiration of this Lease, then, in addition to
any od1er liabilities to Lessor accruing therefrom, Lessee shall protect, defend, indemnify and hold Lessor harmless
liom such failure, including. without limiting the generality of the foregoing. any claims made by any succeeding
tenant, or the loss of such tenant, resulting from such failure to surrender and any lost profits to Lessor resulting
thc:reftom, which lost profits are acknowledged to be foreseeable.
26. Cumulative Remedies. No remedy or election hereunder shall be deemed exclusive but shall. wherever
possible, be cwnulative with all other remedies at law or in equity.
27. Covenants and ConditioDl; Construction of Agreement. All provisions of this Lease to be observed or
performed by Lessee are both covenants and condltions. This Lease sbal1 be construed as though the covenants
herein between the Lessor and the Lessee are independent and Lessee hereby expressly waives the benefit of any
statute to the contrary and agrees that if Lessor fails to perform its obligations set forth herein, Lessee shall not be
entitled to perform any acts at Lessor's expense or to any setoff of the Rent or other amounts owing hereunder
against Lessor except as expressly set forth in this Lease. In construing this Lease, all headings and titles are for the
convenience of the Parties only and shall not be considered a part of this Lease. Whenever required by the context,
the singular shall include the plural and vice versa. This Lease shall not be construed as if prepared by one of the
Parties, but rather according to its fair meaning as a whole, as if both Parties had prepared it.
28. Binding Effect; Choice of Law. This Lease shall be binding upon the Parties, their personal representatives,
successors and assigns and be governed by the laws of the State of California. Any litigation between the Parties
hereto concerning this Lease shall be initiated and held in Los Angeles County.
29. Attorneys' Fees. If any Party brings an action or proceeding involving the Premises or this Lease or the
transactions contemplated hereunder, or the relationship between the Parties arising out of or in connection with this
Lease or the Premises, whether founded in tort, contract or equity, or to declare rights hereunder, the Prevailing Party
(as hereafter defined) in any such proceeding, action, or appeal thereon, shall be entitled to recover from the non-
prevailing party, the prevailing party's court costs, costs of other professionals, and reasonable attorneys' fees. Such
costs and fees may be awarded'in the same suit or recovered in a separate suit, whether or not such action or
proceeding is pursued to decision or judgment. The term. "Prevailing Party" shaH include, without limitation, a
Party who substantiaHy obtains or defeats the relief sought, as the case may be, whether by compromise, settlernent,
judgment, or the abandonment by the other Party of its claim or defense. The attorneys' fees award shall not be
~
Page 13of16
Ioitials
0191010001112620.1
. .
~.i!1 accordance with any court fee schedule, but shall be such as to fully reimburse all attorneys' fe7s.,
teasonably incurred.
30. Lessor's Access; Showing Premises. Lessor and Le~sor's age~ts shall have the right to enter the Premises at
any time, in the case of an emergency, and otherwise at reasonable times after reasonable prior written (which shall
include fax and email) notice for the purpose of showing the same to prospective purchasers, lenders, or lessees
(during the last six (6) months of the Term). All such activities shall be without abatement of rent or liability to
Lessee.
.
. .
31. Signs and Advertising upon the Premises. Lessor may not place on the Premises any "For Sale" or "For
Lease" signs except during the last six (6) months of the tenn hereof. Lessee shall have the right. without the prior
coasent of the Lessor, to place any signs or advertising upon the: Premises or upon any building thereon, provided
any such sign or advertising is permitted by Applicable Requirements. If the sign is located on the front of the
Pnmises, Lessee agrees that it must be in conformity with the aesthetic character of the existing building as
reasonably determined by Lessor. Lessee acknowledges that no signs shall be painted on the front of the Building.
32. TerminatioD; Merger. Unless specifically stated otherwise in writing by Lessor, the voluntary or other
sum:nder of this Lease by Lessee, the mutual termination or cancellation hereof, or a termination hereof by Lessor
for Breach by Lessee, shall automatically terminate any sublease or lesser estate in the Premises; provided, however,
that Lessor may elect to continue anyone or all existing subtenancies. Lessor's failure within ten (10) days
fonowing any such event to elect to the contrary by written notice to the holder of any such lesser interest. shall
constitute Lessor's election to have such event constitute the tennination of such interest
33. Consents. Except as otherwise provided herein, wherever in this Lease the consent of a Party is required to
an act by or for the other Party, such consent shall not be unreasonably withheld, conditioned or delayed. Lessor's.
actual, documented, and reasonable costs and expenses (including but not limited to architects', attorneys',
engineers' and other consultants' fees) incurred in the consideration of, or response to, a request by Lessee for any
Lessor consent, including but not limited to consents to an assignment, a subletting or the presence or use of a
Hazardous Substance, shall be paid by Lessee upon receipt of an invoice and supporting documentation therefor.
Lessor's consent to any act, assignment or subletting shall not constitute an acknowledgment that no Default or
Bmu:h by Lessee of this Lease exisis, nor shall such conSent be deemed a waiver of any then existing Default or
Bn:ach, except as may be otherwise specifically stated in writing by Lessor at the time of such consent. The failure
10 specify herein any particular condition to.Lessor's consent shall not preclude the imposition by Lessor at the time
of consent of such further or other conditions as are then reasonable with reference to the particular matter for which
consent is being given, in the event that either Party disagrees with any determination made by the other hereunder
and reasonably requests the reasons for such determination. the determining party shall finnish its reasons in writing
and in reasonable detail within ten (10) business days following such request
34. Lessee Financing. Lessee's interest in this Lease shall be financeable by Lessee; provided, however, that
Lessor shall have the reasonable right of approval of the financing terms to the extent that they relate to the Lessor's
interest in the Premises. The right of any mortgagee ("Mortgagee") having an interest in this Lease to secure
payment by Lessee of an obligation ("Mortgagej shall be subject and subordinate to each of the covenants,
cooditions, and restrictions set forth in this Lease and to all rights and interest of the Lessor with respect to the
Premises, except as expressly set forth in this Lease. The documents entered into by and between Lessee and
Mortgagee shall contain provisions that all notices of default under the note shall be sent to Lessor and Lessee, and
that Lessor shall have the right (but not the obligation) to cure any Lessee default that Lessee has failed to cure
within thirty (30) days after the time for Lessee to perform such cure under the terms of this Lease has expired.
Neither Lessor's right to cure any default nor any exercise of such right shall constitute an assumption of liability
under the note or Mortgage. On the recording of the Mortgage, Lessee shall, at Lessee's expense, cause to be
recorded in the office of the Los Angeles County Recorder, a written request executed and acknowledged by Lessor
for a copy of all notices of default and all notices of sale under the Mortgage as provided by applicable California
law. Inclusion in the body of the recorded Mortgage itself of a request for notice having the effect described above .
shall constitute compliance with this provision. No Mortgage shall cover any interest in any real property other than
Lessee's interest under this Lease. No Mortgage permitted by this Lease shall cover more than one indebtedness.
35. Quiet Possession. Subject to payment by Lessee of the Rent and performance of all of the covenants,
conditions and provisions on Lessee's part to be observed and performed under this Lease, Lessee shall have quiet
possession and quiet enjoyment of the Premises during the tenn hereof.
36. Options. Lessee is granted seven (7) options to extend the tenn of this Lease (each, an "Option''), with each
Option being for a term of ten (10) years. Lessee may exercise each Option by delivering to Lessor twelve (12)
months' prior written notice of its exercise of the Option; provided, however, that the exercise of any Option shall be
subject to the terms of this ParagJ:liph 36.
36.1 Multiple Options. Because Lessee has multiple Options to extend or renew this Lease, a later Option
cannot be exercised unless the prior Options have been validly exercised.
36.2 Effect of Default 00 Options.
(a) Lessee shall have no right to exercise an Option: (i) during the period conunencing with the
: of any ~~ofDefuok MW =- until: ::1:" ~ (ii) _ ~ ~od m: ~
0191010007112620.1 ~
. .lIIIpIid beyond the applicable notice and cure period, (iii) during. the time Lessee is in Breach of this Lease [by..
'6:Wion, Ii "Breach" only occurs after the notice and cure period have expired);(iv) if Lessee has been in Default
1IIlIIICthan three times during any 12 month period, whether'or not th'I= Defaults have been cured; or (iv) if Lessee
_assigned this Lease or subleased all or any portion of the Premises in violation of the tenns of this Lease.
(b) The period of time within which.an Option may be exercised shall not be extended or enlarged
bytaSOn of Lessee's inability to exercise an Option because of the provisions of Paragraph 36.2(a).
(el An Option shall terminate and be of no further force or effect, notwithstanding Lessee's due
and timely exercise of the Option, if, after such exercise and prior to the commencement of the extended term (i)
I.c:stcc two (2) times commits a Default with respect to its obligation to pay Rent, or (ii) there is a material Default of
dlislase that is not cured within the applicable cure period.
31. Performance Under Protest. If at any time a dispute shall arise as to any amount or S1UD of money to be
"'''r one Party to the other under the provisions hereof, the Party against whom the obligation to pay the mOlley is
IISIlIIIIcd shall have the right to make payment "under protesf' and such payment shall not be regarded as a vohmtary
.-,-ot and there shall survive the right on the part of said Party to institute suit for recovery of such S1UD. If it shall
lie -Judged that there was no legal obligation on the part of said Party to pay such S1UD or any part thereot: said Party
DIllie entitled to recover such S1UD or so much thereof as it was not legally required to pay.
31. Authority; Execution.
38.1 If Lessee is a corporation, trust, limited liability company, partnership, or similar entity, each
iudiwidua1 executing this Lease on behalf of such entity represents and warrants that he or she is duly authorized to
euaIfe and deliver this Lease on its behalf. Lessee shall, within 30 days after request, deliver to the other party
saIisIictory evidence of such authority.
38.2 This Lease may be executed by the Parties in counterparts, each of which shall be deemed an original
1IId. of which together shall constitute one and the same instnnnent
39. Offer. Preparation of this Lease by either Party or their agent and submission of same to the other Party shall
not lie deemed an offer to lease to the other Party. This Lease is not intended to be binding until executed and
deliwred by all P~es hereto.
40. Entire Agreement; Amendinents. This Lease. and any attachments incorporated herein by reference.
CODIIiIute the entire agreement between the Parties hereto affecting this Lease, and supersedes and replaces any and
aBplior or contemporaneous negotiations, arrangements, agreements, discussions, correspoodence. letters of intent.
IIId WJderstandings. whether written or oraI. between the Parties hereto with respect to the subject matter set forth
haaa. This Lease may be modified only in writing. signed by the Parties in interest at the time of the modification.
Any eonflict between the provisions of this Lease and any attachment or addendums shall be controlled by the
"""-I"m or other referenced attachment.
41. Waiver of Jury Trial Each Party hereto expressly waives any right to trial by jury of any claim. demand.
actioa, or cause of action arising under this Lease or in connection herewith or related to or arising out of the
lransKtions contemplated by this Lease or the relationship between the Parties resulting from this Lease.
42. Mandatory Periodic Adjustments; Statutory Chaages. In recognition of the long-rerm nature of this
Lease, all specified dollar amounts set forth herein, including, without limitation, the amounts set forth in Paragraphs
9 (iDmrance) and 14.3 (late charges) shall be adjusted upwards (but not downwards), concurrently with each
adjusIment of the Base. Rent under Paragraph 4.2 hereot: to an amount reflecting the increase in the CPI over the
relevant period, such amount to be calculated in the manner provided in Paragraphs 4.2 and 4.3 hereof. If any
specific section of any statutory law referred to in this Lease is amended. replaced or no longer exists. such section
shaD thereafter be deemed to mean (as the case may be) the section so amended. or the section which has replaced or
supcneded it. or whatever the applicable coinmon law may then be on the subject.
43. Survival. All indemnities, rights, remedies, representations. and warranties contained herein shall survive the
expiration or termination of this Lease.
44. Memorandum of Lease. Upon the request of either Party, the Parties shall execute a Memorandum of Lease
suitable for recording in the Official Records of Los Angeles County in a form sufficient to give notice of the term of
this Lease.
LESSOR AND LESSEE HAVE CAREFULLY READ AND REVIEWED TIllS LEASE AND EACH TERM AND
PROVISION CONTAINED HEREIN, AND BY THE EXECUTION OF TIllS LEASE SHOW THEIR INFORMED
AND VOLUNTARY CONSENT THERETO. THE PARTIES HEREBY AGREE mAT, AT THE TIME nns
LEASE IS EXECUTED, THE TERMS OF TInS LEASE ARE COMMERCIALLY REASONABLE AND
EFFECrUA TE THE INTENT AND PURPOSE OF LESSOR AND LESSEE WITII RESPECf TO THE
PREMISES.
Executed at: V crnon, California
on: January 5. 2005
By LESSOR:
Executed at: Vernon. California
on: Dpc Pr-t h'" 3 I '- 00 'I
,
By LESSEE:
~
Page IS of 16
IDilials
0191MlOO7 112620.\
.
. .
ATTEST:
, City ofVemon
~... ,{ .
By:
Name Printed: Leonis C. Malbllrg
Title: Mayor
By:
Name Printed: Bruce V. Malkenhorst
Title: Ci ry Clprk
APPROVED AS TO FORM:
By:
Eric T. Frl?sch
City Attorney
.
,
IDitiaIs
Ol9101\J007 112620.1
. UNION ICE-PACIFIC, L.P.,
a,California limited partnership
Page 16of16
" .
.
. w
.
By:
Union Ice GP Inc.,
aT=_ ~
Its general ~ . .
B~ d
~B Larso n,
S -T urer
,
By:. ____
. c L. Burke,
President
---
, ,
, .
EXHIBIT
A
" IV/ \I "'
5> .. -,
I .
~ ". ... 1 ..
. ..
. ,
,
EXHIBIT "A"
LEGAL DESCRIPTION
PARCEl J
THAT PORTION OF LOT 31, OF THE 500 ACRE TRACT OF THE LOS ANGELES FRUIT LAND
ASSOCIATION, IN THE CITY OF VERNON, COUNTY OF LOS A'JGELES, STATE OF CALIFORNIA, AS PER
MAP RECORDED IN BOOK 3, PAGES 156 AND 157 OF MISCELLANEOUS RECORDS, IN THE OFFICE OF
THE COUNTY RECORDER Of SAID COUNTY, DESCRIBED AS F')LLOWS:.
BEGINNI:'I<IG AT THE NORTHEAST CORNER OF SAID LOT 31; THENCE SOUTH 321.50 FEET ALONG THE
EAST LINE OF SAID LOT 31 TO THE NORTH LINE OF THAT 1".00 FOOT WIDE RIGHT OF WAY OF THE
LOS ANGELES JUNCTION RAILWAY, AS DESCRIBED IN DEED TO CENTRAL MANUFACTURING
DISTRICT INC., RECORDED 4-7-1927, IN BOOK 4752, PAGE 265 OF OfFICIAL RECORDS, IN SAID
RECORDER'S OFFICE; THENCE WEST 387.70 FEET ALONG SAID NORTH LINE OF SAID RIGHT OF WAY
TO THE INTERSECTION OF A LINE THAT IS 387.70 FEET WEST 'v1EASURED PERPENDICULAR TO AND IS
PARALLEL WITH THE EAST LINE OF SAID LOT 31; THENCE NORTH 321.50 FEET ALONG LAST SAID
PARALLEL LINE TO THE NORTH LINE OF SAID LOT 31; THENCE EAST 387.70 FEET ALONG SAID
NORTH LINE OF SAID LOT 31, ALSO BEING THE CENTERLINE .)F EAST 50TH STREET, 40.00 FEET WIDE,
AS DES('RIBED II'i DEED TO THE CITY OF VERNON, RECORD,:D 9-5-1929, AS DOCUMENT NO. 1410, IN
BOOK crus. PAGE 149 Of OFFICIAL RECORDS, IN SAID RI:CORDER'S OFfiCE, TO THE POINT OF
BEGINNING.
EXCEPT THEREFROM THE NORTH 20.00 FEET OF SAID LOT 31. THE SOUTH LINE OF SAID NORTH 20.00
FEET, ALSO BEING THE SOUTH LINE OF EAST 50TH STREET 41..00 FEET WIDE, AS DESCRIBED IN DEED
TO THE CITY OF VERNON, RECORDED 9-5-1929, AS DOCUME'fNO. 1410, IN BOOK 9335, PAGE 1490F
OFFICIAL RECORDS. IN SAID RECORDER'S OFFICE.
. SUPPORTING
DOCUMENTS
4//1/.// c.-t:Z/ u
RISK MANAGEMENT OFFICE
INTER-DEPARTMENT MEMORANDUM
DATE:
February 21, 2006
TO:
Nelly Giron
Deputy City Clerk
FROM:
Willard G. Yamaguchi lr~
Chief Deputy City Attorney/Acting Risk Managyv . LJ
RE:
Union Ice-Pacific, LP
Please be advised that the above referenced has provided
acceptable insurance coverage.
Attached for your retention are original insurance certificates
and related policies, declarations and/or endorsements for the
above-referenced insured that were issued by:
. Transportation Insurance (General Liability and
Excess/Umbrella Liability)
. American Casualty Company of Reading (Automobile Liability
and Auto Physical Damage)
This concerns ~esolution No. 8632, Agreement File No. 05-004.
-- -
WY!kr
Client#: 64550
UNION ICE
ACORDTM CERTIFICATE OF LIABILITY INSURANCE
DATE (MMlDDIYYYY)
02/16/06
THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION
ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE
HOLDER. THIS CERTIFICATE DOES NOT AMEND, EXTEND OR
ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW.
PRODUCER
DWP/USI of Southern California
Lic# OE61929
3625 Del Amo Blvd, Suite 300
Torrance, CA 90503
Union Ice Ltd
Union Ice-Pacific LP
901 East E Street
Wilmington, CA 90744
COVERAGES
INSURERS AFFORDING COVERAGE
INSURER A: Transportation Ins CO.
INSURER B: American Casualty Company of Reading
INSURER C:
INSURER 0:
INSURER E:
NAIC#
NONE
INSURED
THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING
ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECt TO WHICH THIS CERTIFICATE MAY BE ISSUED OR
MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH
POLICIES. AGGREGATE LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS.
LTR NSR TfPE OF INSURANCE PGUCY NUMBER PJ>A~~=~ ~~~J~~N LIMITS
A ~ERAL LIABILITY C2082420124 04/01/05 04/01/06 EACH OCCURRENCE $1.000 000
~ OMMERCIAL GENERAL UABILITY DAMAGE TO RENTED $500 000
I-- CLAIMS MADE [j] OCCUR MED EX? (Anyone person) $10000
I-- PERSONAL & ADV INJURY $1.000000
I-- GENERAL AGGREGATE $2.000 000
GEN'L AGGREnE LIMIT APnS PER: PRODUCTS-COMProPAGG $2 000 000
n PRO-
POLICY JECT LOC
B ~TOMOBILE LIABILITY C2082419877 04101/05 04/01/06 COMBINED SINGLE LIMIT $1,000,000
.!- AI>N AUTO (Ea accident)
. - ALL OWNED AUTOS BODILY INJURY
$
SCHEDULED AUTOS (Per person)
~
.!- HIRED AUTOS BODILY INJURY
$
.!- NON-OWNED AUTOS (Per accident)
PROPERTY DAMAGE $
(Per accident)
~RAGE LIABILITY AUTO ONLY - EA ACCIDENT $
ANY AUTO OTHER THAN EA ACC $
AUTO ONLY: AGG $
A ~ESSIUMBRELLA LIABILITY C2082419880 04/01/05 04101/06 EACH OCCURRENCE $10 000 000
X OCCUR D ClAIMS MADE AGGREGATE $10.000 000
$
~ DEDUCTIBLE $
X R"TENTlON $10000 $
WORKERS COMPENSATION AND I WCSTATU-I 10.I~-
EMPLOYERS' LIABILITY E.L. EACH ACCIDENT $
ANY PROPRIETORlPARTNERlEXECUTIVE
OFFICERlMEMBER EXCLUDED? E.L. DISEASE - EA EMPLOYEE $
If yes. describe under E.L. DISEASE - POLICY LIMIT $
SPECIAL PROVISIONS below
B OTHER Auto C2082419877 04/01/05 04101/06 $1,000 Coli Deductible
Physical Damage $1,000 Comp Deductible
DESCRIPTION OF OPERATIONS I LOCATIONS I VEHICLES I EXCLUSIONS ADDED BY ENDORSEMENT I SPECIAL PROVISIONS
*Except 10 day notice of cancellation for nonpayment of premium
RE: 2970 E. 50TH ST., VERNON, CA. 90058.
CITY OF VERNON IS NAMED AS ADDITIONAL INSURED AS THEIR INTERESTS
MAY APPEAR, PER CG 2011 ATTACHED. PLEASE NOTE UMBRELLA EXCESS POLICY
COMBINES WITH GL TO PROVIDE $12 MILLION LIMITS AGGREGATE.
CITY OF VERNON
ATTN: RISK MANAGEMENT
KARINA RUEDA, ADMIN. 'ASSIST.
4305 SANTA FE AVENUE
VERNON, CA 90058-0805
CANCELLATION
SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION
DATE THEREOF, THE ISSUING INSURER WILL ENDEAVOR TO MAIL -3.0- DAYS WRmEN
NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE LEFT, BUT FAILURE TO DO SO SHALL
IMPOSE NO OBLIGATION OR LIABILITY OF ANY KIND UPON THE INSURER, ITS AGENTS OR
REPRESENTATIVES.
AUTHORIZED REPRESENTATIVE
CERTIFICATE HOLDER
CLTJF
@ ACORD CORPORATION 1988
ACORD 25 (2001/08) 1 of 2
#S3446831M338563
Po.licy Number:
C2082420124....
Commercial General Liability
INSURED: UNION ICE L TO
UNION ICE-PACIFIC LP
THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY.
ADDITIONAL INSURED - MA\JAGERS OR LESSORS OF
PREMISES
This endo.rsement modifies insurance pro.vided under the follo.wing:
COMMERCIAL GENERAL LIABILITY COVERAGE PART.
SCHEDULE
Designation of Premises (Part Leased to You): 2970 E. 50TH. STREET
VERNON, CA 90058
Name of Person or Organization: CITY OF VERNON
4305 SANTA FE AVENUE
VERNON, CA 90058
(If no entry appears abo.ve, info.rmatio.n required to co.mplete this endorsement will be shown in
the Declarations as applicable to' this endo.rsement.)
WHO IS AN INSURED (Section II) is amended to' include as an insured the perso.n o.r
o.rganizatio.n shown in the Schedule but only with respect to' liability arising out of the ownership,
maintenance o.r use of that part of the premises leased to you and sho.wn in the Schedule and
subject to the following additional exclusio.ns:
This insurance does no.t apply to:
1. Any "occurrence" which takes place after yo.u cease to' be a tenant in that premises.
2. Structural alterations, new construction o.r demolition o.peratio.ns performed by or on
behalf o.f the person or organizatio.n shown in the Schedule.
CG 20 11 11 85
Copyright, Insurance Services Offices, Inc. 1984
~NA
~eneral Liability - Occurrence
New Business Declaration
:t:::::~:::~~:)::)~):)~~~))~::::ll~:::~:~)))::)])))]~)~)~~))~ml:~)~)::))))))::):~)m:~:)~~)):))::::l:~::~)))::)~~rr::::~~~:::::::::::))~~:~~~)~)~)~:~~::~::::::r))~~:~~~~~~~)~i~::)~:))I)~~)):)~)):)I)r)~:::)::~~)~~~::Il:)m:~~~~I~:)~~~)~~~~U~~))))~~)~:)))l)~n:rt:::::~~!~::::~:)):~::~i::~:::::::r::)~)))~!~~~~I)))~~~)~~))~)I)))~:~))m)))))I~~~::~)lj~r.~~)~l~:~:)~:)m::~~III~~~~~~~~:~@::!!~
POLICY NUMBER
C 2082420124
COVERAGE PROVIDED BY
TRANSPo.RTATION INSURANCE Co.MPANY
CNA PLAZA
CHICAGO, ILLINOIS 60685
FROM - POLICY PERIOD - ~O
04/01/2005 04/01/2006
INSURED NAME AND ADDRBSS
UNION ICE-PACIFIC LP
C/O. BRENT LARSo.N CFo.
901 EAST "E" STREET
WILIMINGTo.N, CA 90744
AGENCY NlJIIBER
062933
AGENCY NUB AND ADDRESS
DWP USI OF so.. CAL. INS AGENCY INC.
3625 DEL AMO BL., #300
To.RRANCE, CA 90503
Phone Number: (310)542-4370
BRANCH NlJIIBER
240
..
BRANCH NUB AND ADDRESS
WOODLAND HILLS
5820 CANOGA AVE., 2ND FLo.OR
Wo.o.DLAND HILLS, CA 91367
Phone Number: (800)262-8714
NWi:~~~~~)@:::!]@:))::m:::~j::~:!:~))))))~)~))IM~::~~m):~::~~~r~~:l:~~i~):~r!~~:I:))~:~:~:~~~:)~:::)))I~i)i!Im::::::~~m)~rmtI:::::::~~~l~~:]:t)))~lm)))m~)~M:~:~~~liM~~WI!~~if.Nlm::):)~)m~@j~l)f~!r~t~)ili!Il~I!)~~I:~*!~*-::)~M)l~l:r~lm~))r))~)II)j
This policy becomes effective and expires at 12:01 A.M. standard time at your mailing
address on the dates shown above.
The Named Insured is a Limited Partnership.
Your policy is composed of this Declarations, with the attached Common Policy Conditions,
Coverage Forms, and Endorsements, if any. The Policy Forms and Endorsement Schedule
shows all forms applicable to this policy at the time of policy issuance.
The Estimated Policy Premium is
$71,072 .00
=
-
___ Your Premium includes the following amount for
Certified Acts of Terrorism Coverage
$1,455.00
;;;;;-.
!!!!!!!!!
Audit Period is Annual
iiiiiiili
In return for the payment of the premium, and subject to all the terms and conditions
contained here-in, we agree to provide the insurance as stated.
-
-
===
-.
~
=
AGENT
Page
1 of
5
:p6E:ICY::::::NUDER':':':':':':':.:':':':':':':':":':':.,.,.,.............................................IN.SURED".NAiiE""AND"'ADDRE"S'S'..
C 2082420124 UNION ICE-PA~IFIC LP
C/O BRENT LARSON CFO
901 EAST "E" STREET
WILIMINGTo.N, CA 90744
LIMITS OF INSURANCE
.
DESCRIPTION
LDUT
Personal & Advertising Injury
$1,000,000
$1,000,000
Each Occurrence
Damage To Premises Rented To You Limit
$10,000
$500,000
Medical Expense - Any One Person
Products/Completed Operations Aggregate
$2,000,000
General Aggregate
$2,000,000
Employee Benefits Liability Coverage
Each Employee
Aggregate
$1,000,000
.$1,000,000
SCHEDULE OF LOCATIONS AND COVERAGES
COVERAGE/HAZARD DESCRIPTION
PREII::roM
EXPOSURE BASIS RATE
ESTDlATED
PREII::roM
POLICY LEVEL COVERAGES
.
Employee Benefits Liability
70 Each INCL
Employee
$99
Deductible Each Employee
$1,000
Fire Damage Legal Liability - Increased Limits
FLAT CHARGE
$20
Location 1
901 East E Street
Wilmington, CA 90744
Class Code 14405
Ice Dealers and Distributors. Products-completed
operations are subject to the General Aggregate
Limit.
Additional Insured - Designated Person
5%
$47,684
$2,384
Premises & Operations
7,000,000 (S)
6.812
Class Code 99917
Warehouses - cold storage - public. Products-
completed operations are subject to the General
Aggregate Limit.
Premises & Operations
795,000 (P)
24.440
$19,430
.
AGENT
Page
2 of
5
;=gE:ia::::::~~i:::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::IN:SUR:ED::::::NUlf"::AJiir:':ADDRE:S:g-:.:.:.:.:.:-:.:.:.:.:.:.:.:.:.:.".:.:.,.:.:.:.:.:.:.:.:.:.:.:.,............-.................................................................-.-.-.-.-.-......-...-...-.-..............................w...-.-...-.......-.......
C 2082420124 UNION !CE,PACIFIC LP
C/O BRENT LARSON CFO
901 EAST "E" STREET
WILIMINGTON, CA 90744
.~~
FORMS AND ENDORSEIIEN'fS SCHEDULE
Form Number
CGOOOl
CG2026
CG2147
CG2170
CG2279
G129991E
G132263A
G134802B
G136080A
G136106C
G136107A
G138921B
G142561A04
G144291A
G145658A
G15104A
G43316C
G43815C
G55157B
IL0003
IL0017
IL0021
.L0270
10/2001
11/1985
07/1998
11/2002
07/1998
11/2003
08/1998
06/2001
02/2000
11/2003
03/2000
11/2003
06/2002
03/2003
11/2003
10/1989
06/1998
08/2001
02/1988
07/2002
11/1998
04/1998
07/2002
Form 'fitle
Commercial General Liability Coverage Form
Add Insured-Designated Person or o.rganization
Employment-Related Practices Exclusion y/
Cap on Losses for Certified Acts of Terrorism ~
Exclusion - Contractors - Professional Liability r"
Exterior Finish System Exclusion <i!fls
Amendatory Endorsement - Pollution Exclusion ~
Noncontractors Additional Ins~Endorsement~
Arndt of Ins Agree-Known or Continuing Inj or Damg.........j/
Residential Construction Defect PCO. Exclusion r
Exclusion - Construction Wrap-Up Program ~
Excl-Subsidence(Az,Ca,Co,Nv) Excl-Subidence Resid ~
Fungi/Mold/Mildew/Yeast/Microbe Exclusion-Contract ~
Economic And Trade Sanctions Condition ~
Exclusion - Silica ~
Employee Benefits Liability Supplemental Schedule ~
Exclusion - Asbestos ~ ~
Employee Benefits Liability Coverage
Premium Bases
Calculation of Premium
Common Policy Conditions
Nuclear Energy Liab Exclusion Endt (Broad Form)
California Changes - Cancellation and Nonrenewal
~/
;./
1<i'
*** PLEASE READ 'fHE ENCLOSED IMPOR'fAN'f NO'fICES CONCERNING YOUR POLICY ***
Form NUJIIber
G144233C
G145041A
G4412BB
-
-
-
==
-
01/2005
OS/2003
11/2004
Form 'fitle
Notice - Offer of Terrorism Disclosure of Premium
IMP INF Economic And Trade Sanctions condition
Imp Info For Insureds Who Hire Subcontractors
Countersignature
-M HI
== J~
Chairman of the Board
~~
P-55170-A (Ed. 01/86)
AGENT
Page
5 of
5
Best's Rating Center - Company Info.rmatio.n fo.r American Casualty Co.mpany of Reading... Page I o.f2
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American Casualty Company of Reading, PA
(a member of CNA Insurance Companiel>) (view securities for related issuers)
A.M.Best ft.: 0%1%7 HAle #: 20427 FEIN #: %3034%560
Stock Ticker: N_ Yort Stock Exchange NYSE: CNA
Address: CNA Center, 333 South Wabash
Chicago, IL 60685
Assigned to companies that
have. in our opinion. an
excellent ability to meet their
ongoing obligations to
policyholders.
Phone: 312-822-5(K)Q
Fax:312-822~19
Web: www.cna.com
Best's Ratings
Financial Strength Ratings VieW Definitions
Rating: A (Excellent)
Affiliation Code: g (Group)
Financial Size Category: XV ($2 billion or more)
Outlook: Negative
Action: Affirmed
Effective Date: June 21, 2005
* Denotes Under Review Best's Ratin~
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Long-Term: a
Outlook: Negative
Action: Assigned
Date: June 21, 2005
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A.M.Best #: 02131 HAle #: 20494 FEIN #: 361877247
Stock Ticker: New York Stock Exchange NYSE: CNA
Address: CNA Center, 333 South Wabash
Chicago, IL 60685
Assigned to companies that
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Phone: 312~822-5000
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Outlook: Negative
Action: Assigned
Date: June 21, 2005
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Affiliation Code: 9 (Group)
Financial Size Category: XV ($2 billion or more)
. Outlook: Negative
Action: Affirmed
Effective Date: June 21, 2005
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Besfs Executive Summary Reports (Financial Overview) - available in three versions, thl
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i';'
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I" 11
{';
(I
GROUND LEASE
\. Basic Provisions ("Basic Provisions").
1.1 Parties: This Ground Lease ("Lease"), dated for reference purposes only, December 27, 2004,
is made by and between the City of Vernon ("Lessor") and Union Ice. Ltd., or a related entity designated by Union
Ice-Pacific, L.P., a California limited partnership, whose creditworthiness is reasonably acceptable to the Lessor and
who will use the Premises as set forth in Paragraph 6.1 ("Lessee"), (collectively, the "Parties," or individually a
"Party"). For the purposes of this Lease, the "Execution Date" shall mean the date upon which this Lease is fully
executed and delivered by both parties.
\.2 Premises: That certain real property, consisting of approximately 113,000 square feet of land
("Land"), including the building (the "Building") thereon, located at 50th Street in the City of Vernon, County of
Los Angeles, State of California, which is more particularly described on Exhibit "A" attached hereto ("Premises").
As used herein, the Premises means the land and the Building (as the same may from time to time exist), but
excludes any mineral, oil, gas or other hydrocarbon substances.
\.3 Term: The term of this Lease (the "Term") shall commence on and as of the Execution Date, and
shall expire (without further notice from or to, or act by, either party) at 11:59 p.m. on the twenty-fifth (25th)
anniversary ofthe Rent Start Date (as defined in Paragraph 4.6) (the "Expiration Date"), unless earlier terminated or
extended pursuant to the terms ofthis Lease. If the Lease Term is extended pursuant to an Option, as defined below,
the word "Term" shall mean and refer to the extended Term, and the term "Expiration Date" shall mean and refer
to the Expiration Date of the option term then in effect. Notwithstanding any provision of this Lease to the contrary,
Lessee shall have the right to tenninate this Lease at any time following the renovation or reconstruction of the
Building, as set forth in Paragraph 7.2 below, in its sole discretion by providing prior written notice thereof to Lessor
not less than one hundred and eighty (180) days before the effective date of such termination.
\.4 Base Rent: $10,359.62 per month ("Base Rent"), payable on the first day of each month commencing
on the Rent Start Date set forth in Paragraph 4. The Base Rent is to be adjusted as set forth in Paragraph 4.
2. Premises.
2.1 Letting. Lessor hereby leases to Lessee, and Lessee hereby leases from Lessor, the Premises, for the
term, at the rental, and upon all of the terms, covenants and conditions set forth in this Lease. Unless otherwise
provided herein, any. statement of size set forth in this Lease, or that may have been used in calculating Rent, is an
approximation which the Parties agree is reasonable and any payments based thereon are not subject to revision
whether or not the actual size is more or less.
2.2 Acknowledgements. Lessee acknowledges that: (a) it has been advised by Lessor to satisfy itself
with respect to the condition of the Premises (including but not limited to the existing structure of the Building,
seismic and geological issues, the roof and the foundations, and all building systems, including electrical, plumbing,
water and sewer capacities and their suitability for Lessee's intended use), as well as all issues related to the
existence (if any) of Hazardous Substances (as defined in Paragraph 6.2(a)) on, in, under, or around the Premises,
and the existence (if any) of above ground or below ground storage tanks in, on, under, or around the Premises
(provided, however, that Lessor shall have sole responsibility for the existence of any Hazardous Materials in, on,
under or about the Premises prior to the Commencement Date ("Existing HazMat Condition"), (b) Lessee shall
have made such investigations as it deems necessary with reference to such matters and all other matters related to
the Premises, including development and functionality, zoning, access, and value, and assumes all responsibility
therefor as the same relate to its reconstruction and occupancy of the Premises, and (c) neither Lessor nor Lessor's
agents have made any oral or written representations or warranties with respect to any matters related to the Premises
other than as set forth in this Lease.
2.3 "As Is" and Where Is". (a) LESSEE IS RELYING SOLELY ON ITS OWN INSPECTION AND
EXAMINATION OF ALL LEGAL, PHYSICAL AND OTHER ASPECTS OF THE PREMISES IN ENTERING
INTO THIS LEASE, AND NOT ON ANY WRITTEN OR ORAL INFORMATION PROVIDED OR TO BE
PROVIDED BY LESSOR OTHER THAN AS SET FORTH IN THIS LEASE; (b) LESSEE IS LEASING THE
PREMISES ON AN "AS IS" AND "WHERE IS" AND "WITH ALL FAULTS" BASIS WITH ALL FAULTS
OR CONTINUING OBLIGATIONS NOW KNOWN OR HEREAFTER DISCOVERED BY LESSEE, EXCEPT
WITH RESPECT TO ANY EXISTING HAZMAT CONDITION; AND (c) LESSOR HAS NO OBLIGATION TO
REPAIR OR TO CORRECT ANY CONDITIONS OR DEFECTS AFFECTING THE PREMISES OR TO
COMPENSATE LESSEE FOR THE SAME, EXCEPT WITH RESPECT TO ANY EXISTING HAZMAT
CONDITION.
2.4 Due Diligence. Because Lessee is relying on its own due diligence in regard to the condition of the
Premises, as set forth above, Lessee shall have a period of 60 days after the Execution Date in. which to conduct and
complete its due diligence on the Premises (the "Due Diligence Period"). Lessee shall be entitled to possession of
the Premises for due diligence purposes on the Execution Date provided Lessee has provided to Lessor the certificate
of insurance described below. puring the Due Diligence Period, Lessee shall have the right to fully satisfy itself as
to the condition of the Premises, the usefulness of the Premises for its business purposes, the value of the Premises,
and all conditions related to the Premises, including environmental issues, geological and seismic issues, condition of
the Building and Building systems, and all other matters by making such tests, inspections or investigations as Lessee
deems necessary or proper in accordance with the terms of this Paragraph 2.4. Lessee may, by written notice
delivered to Lessor prior to 6:00 PM on the last day of the Due Diligence Period, tenninate this Lease in its sole
discretion. If Lessee does not terminate the Lease by written notice delivered within the Due Diligen e Period,
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Lessee will have waived its right to terminate the Lease (e;xcept as otherwise set forth in this Lease), and this Lease
shall remain in full force and effect in accordance with its terms. If Lessee timely terminates this Lease, this Lease
shall be null and void, and of no force and effect, and neither party will have any obligation or liability to the other.
Lessee shall not have the right to possession or to commence its due diligence until Lessee has delivered to Lessor a
certificate of insurance evidencing insurance coverage as set forth in Paragraph 9, and such insurance shall remain in
full force and effect until the last day of the expiration of the Due Diligence Period, and, if the Lease is not then
terminated, Lessee shall maintain the insurance as required by Paragraph 9 until the termination of this Lease.
Lessee shall indemnify, defend, and hold harmless Lessor against any damages, claims, costs, or expenses arising out
of Lessee's entry onto the Premises and due diligence inspections. If Lessee elects to terminate this Lease during the
Due Diligence Period, then Lessee shall return the Premises to its condition prior to any testing, and if this Lease
remains in effect following the Due Diligence Period, Lessee shall fill in any holes or borings created by any testing
No invasive or intrusive testing shall be permitted without the prior written consent of Lessor, and Lessor may elect
to be present at such testing.
3. Term.
3.1 Term. The Term shall commence on the Execution Date, subject to termination by Lessee on or
before the last day of the "Due Diligence Period. The Commencement Date shall be as defined in Paragraph 3.2, and
the Lease shall be subject to termination by Lessee as set forth in Paragraph 7.2 between the last day of the Due
Diligence Period and the Commencement Date. The Term shall end on the Expiration Date; provided, however, that
the Lease is further subject to early termination and extension on the terms set forth in this Lease.
3.2 Commencement Date. If Lessee does not terminate this Lease during the Due Diligence Period,
Lessee shall develop plans for its renovation, if any, of the Building, and diligently proceed to obtain any necessary
governmental or quasi-governmental permits, approvals, and authorizations necessary for the renovation of the
Building in final, non-appealable form (collectively, the "Permits"). The date on which the City of Vernon issues all
of the Permits required for Lessee's proposed renovation of the Building in final, non-appealable form shall be
referred to as the "Commencement Date". (See Paragraph 7.2 re Lessee's right to terminate this Lease if Lessee
fails to obtain Permits timely). Notwithstanding the Commencement Date, Rent shall be payable on the terms set
forth in Paragraph 4.
4. Rent
4.1 Rent Defined. All monetary obligations of Lessee to Lessor under the terms ofthis Lease are deemed
to be rent ("Rent").
4.2 Base Rent. Lessee shall pay to Lessor fixed rent in advance in the amount of One Hundred Twenty-
Four Thousand Three Hundred Fifteen and 401l00ths Dollars ($124,315.40) NNN per year, payable in twelve (12)
equal monthly installments of Ten Thousand Three Hundred Fifty-Nine and 62/100ths ($10,359.62), subject to
adjustment as set forth below (the "Base Rent"), on the Rent Start Date and thereafter on the first (1'1) day of each
calendar month during the Term. The Base Rent shall be adjusted upward (but never downward, and never by any
single increase exceeding fifteen percent (15%) of the Base Rent then in effect) on every tenth (10th) anniversary of
the Rent Start Date (the "Adjustment Date") during the Term. The then-applicable Base Rent shall be increased on
each Adjustment Date to an amount to be determined by adding to the then-applicable Base Rent an amount equal to
the then-applicable Base Rent multiplied by the percentage of increase, if any, of the "Consumer Price Index for All
Urban Consumers, Los Angeles-Anaheim-Riverside, California, Subgroup All Items (1982-1984=100)", published
by the United States Department of Labor, Bureau of Labor Statistics (the "CPI") for (i) the calendar month which is
three (3) months immediately preceding the Rent Start Date (the "Base Index"), in the case of the first Adjustment
Date, and (ii) the calendar month which is three (3) months immediately preceding the previous Adjustment Date, in
the case of all subsequent Adjustment Dates, and the month that is three (3) months preceding the month in which the
Adjustment Date occurs (the "Adjustment Index").
4.3 Unavailability of Index. If the Adjustment Index is unavailable on the date on which any installment
of Base Rent as adjusted shall become due, Lessee shall continue to pay the then-applicable Base Rent payable by
Lessee until the Adjustment Index is available, and the adjustment, if any, shall be aggregated and paid retroactively
as one lump sum with the then-applicable Base Rent for the first (1'1) month in which the Adjustment Index is
available. If the Bureau of Labor Statistics ceases to uSe the 1982-1984 base of 100 as the basis of calculation for the
CPI, then the Base Index and the Adjustment Index shall be adjusted in accordance with the conversion formula
published by the Bureau of Labor Statistics. If, at any time required for the determination of the amount of any
adjustment in Base Rent, the CPI is no longer published or issued, Lessor shall reasonably select a reliable
governmental or other non-partisan publication evaluating the information theretofore used in determining the CPI,
and shall give Lessee no less than ten (10) days' prior written notice of such selection.
4.4 Additional Charl!:cs. Lessee hereby assumes any and all burdens, obligations, expenses, and shall
perform all actions as may be required of or for the Premises, for Lessor's interest in the Premises, for Lessee's
interest in the Premises, and for any other occupant of the Premises, except for any obligations with respect to
Existing HazMat Conditions, which shall remain Lessor's obligation and responsibility. This Lease is a "triple net"
or "absolute net" of "net, net, net" or "bond" lease whereby the Rent accruing under this Lease shall be totally net to
Lessor; and accordingly, Lessee shall pay all taxes, insurance, repairs/maintenance costs, utility and other expenses
and charges of every kind and nature, whether currently in effect or subsequently made payable relating to the
Premises (but not the income therefrom), including, without limitation, any property taxes that may be assessed as a
result of the Lease being deemed a "Transfer" under Prop. 13, which may arise or become due durin e Term
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(collectively, "Additional Charges"), but excluding any payments for interest or principal under any Mortgage made
by Lessor relating to the Premises or any costs relating to Existing HazMat Conditions. All Additional Charges
which Lessee is obligated to pay under any provisions of this Lease, together with all interest and penalties that may
accrue on these Additional Charges in the event Lessee fails to pay them, as well as all other damages, costs and
expenses, including, without limitation, reasonable attorneys' fees and other legal and court costs which Lessor may
incur in enforcing this Lease, and any and all other sums which may become due by reason of Lessee's failure to
comply with its obligations under this Lease, shall be deemed to be Additional Rent. In the event of non-payment,
Lessor shall have all the rights and remedies as provided in the case of non-payment of Base Rent. If any law
currently in effect or subsequently enacted prohibits a Lessee from paying a tax or other charge that is contemplated
hereunder to be paid by Lessee, the amount of such tax or other charge shall be added to the Base Rent, as it is the
intent of the parties that Lessor have no obligation to pay any charges, fees, costs or taxes on account of the Premises
during the Term.
4.5 Payment. Lessee shall cause payment of Rent to be received by Lessor/in lawful money of the
United States on or before the day on which it is due, without offset or deduction (except as specifically permitted in
this Lease). Rent for any period during the term hereof which is for less than one full calendar month shall be
prorated based upon the actual number of days of said month. Payment of Rent shall be made to Lessor at its address
stated herein or to such other persons or place as Lessor may from time to time designate in writing. Acceptance of a
payment which. is less than the amount then due shall not be a waiver of Lessor's rights to the balance of such Rent,
regardless of Lessor's endorsement of any check so stating. In the event that any check, draft, or other instrument of
payment given by Lessee to Lessor is dishonored for any reason, Lessee agrees to pay to Lessor the greater of the
sum of $25 or the charge then imposed by Lessor's bank in addition to any Late Charge and after any two (2) such
payments in any twelve (12) month period Lessor, at its option, may require all future payments for 24 months to be
made by Lessee to be by cashier's check. If Lessee's payment of Base Rent is more than five (5) days late two (2) or
more times in any 12 month period, Lessor may require that all future payments of Base Rent be paid quarterly in
advance for the next 24 months. Payments will be applied first to accrued late charges and attorney's fees, second to
accrued interest, then to Base Rent and any remaining amount to any other outstanding charges or costs.
4.6 Rent Start Date. Base Rent shall be abated until the earlier of (a) the first anniversary of the
Commencement Date or (b) the date Lessee obtains from the City of Vernon an occupancy permit or temporary
occupancy permit for the entire Premises.
4.7 Additional Charges Start Date. During the Due Diligence Period, Lessee shall not be obligated to
pay Base Rent or any other Additional Charges (other than carrying the insurance described in Paragraph 9). After
the expiration of the Due Diligence Period, Lessee shall pay Additional Charges.
5. Security Deposit. None.
6. Use.
6.1 Use and Continuing Operating Covenant. The Premises may be used and occupied solely for ice
production and food processing and cold food storage or another legal use that is proposed in writing by Lessee and
accepted in writing by Lessor, in Lessor's sole and absolute discretion; provided, however, that Lessor shall not
unreasonably withhold, condition or delay its consent to a change of use with the same or more number of employees
and power consumption as has historically been used by Lessee. Lessee acknowledges that Lessor, in its role as the
City of Vernon, is implementing certain development plans within the City of Vernon, and has established certain
criteria for use of property within the City of Vernon, and that the Lessor does not intend to approve any use of the
Premises that does not comply with the City of Vernon's development plans and long term goals. Lessee shall not
use or permit the use of the Premises in a manner that does not comply with this Paragraph 6.1, or is unlawful,
creates damage, waste or a nuisance, or causes damage to neighboring premises or properties. Lessee acknowledges
and agrees that the primary value of this Lease to Lessor is based on the continuing operations and usage of the
entirety of the Premises for the purposes set forth in this Paragraph 6.1. Therefore, Lessee agrees to continually
maintain and operate the entire Premises for the purposes set forth herein during every business day of the Term, and
not to abandon, cease using, or change the usage (except with the written approval of Lessor as set forth above) of
~y portion of the Premises, and to ensure that any subtenant or assignee complies with this covenant of continuing
operation, subject to reasonable interruptions for damage, destruction, or remodeling, and to additional short term
(not more than twenty (20) consecutive business days or thirty (30) non-consecutive business days in any 12 month
period) closures for other reasonable business purposes. In addition, any lender that acquires Lessee's interest in the
Premises shall not be required to operate the Premises; however,! any successor to such lender shall be required to
comply with the foregoing provisions of this Paragraph 6.1, including the operating covenant.
6.2 Hazardous Substances.
(a) Reportable Uses Require Consent. The term "Hazardous Substance" as used in this Lease
shall mean any product, substance, or waste whose presence, use, manufacture, disposal, transportation, or release,
either by itself or in combination with other materials expected to be on the Premises, is either: (i) potentially
injurious to the public health, safety or welfare, the environment or the Premises, (ii) regulated or monitored by any
governmental authority, or (iii) a basis for potential liability to any governmental agency or third party under any
applicable statute or common law theory. Hazardous Substances shall include, but not be limited to, hydrocarbons,
petroleum, gasoline, and/or crude oil or any products, by-products or fractions thereof, and asbestos containing
materials. Except in connection with Lessee's permitted use (and provided that such action is taken in compliance
with all Applicable Requirements), Lessee shall not engage in any activity in or on the Premises which constitutes a
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Reportable Use of Hazardous Substances without the exprr.ss prior written consent of Lessor and timely compliance
(at Lessee's expense) with all applicable laws, covenants, restrictions, regulations and ordinances ("Applicable
Requirements"). "Reportable Use" shall mean (i) the installation or use of any above or below ground storage
tank, (ii) the generation, possession, storage, use, transportation, or disposal of a Hazardous Substance that requires a
permit from, or with respect to which a report, notice, registration or business plan is required to be filed with, any
governmental authority, and/or (iii) the presence at the Premises of a Hazardous Substance with respect to which any
Applicable Requirements requires that a notice be given to persons entering or occupying the Premises or
neighboring properties. Notwithstanding the foregoing, Lessee may use any ordinary and customary materials
reasonably required to be used in the normal course of the Agreed Use, ordinary office supplies (copier toner, liquid
paper, glue, etc.) and common cleaning materials for food production and refrigeration uses (including, without
limitation, ammonia), so long as such use is in compliance with all Applicable Requirements. In addition, Lessor
may condition its consent to any Reportable Use upon receiving such additional assurances as Lessor reasonably
deems necessary to protect itself, the public, the Premises and/or the environment against damage, contamination,
injury and/or liability, including, but not limited to, the installation (and removal on or before Lease expiration or
termination) of protective modifications (such as concrete encasements).
(b) Duty to Inform Lessor. If Lessee knows, or has reasonable cause to believe, that a
Hazardous Substance haS come to be located in, on, under or about the Premises after the Commencement Date,
other than as previously consented to by Lessor, Lessee shall immediately give written notice of such fact to Lessor,
and provide Lessor with a copy of any report, notice, claim or other documentation which it has concerning the
presence of such Hazardous Substance.
(c) Lessee Remediation. Lessee shall not cause or permit any Hazardous Substance to be spilled
or released in, on, under, or about the Premises (including through the plumbing or sanitary sewer system) and shall
promptly, at Lessee's expense, comply with all Applicable Requirements and take all investigatory and/or remedial
action required by applicable law for the cleanup of any contamination of, and for the maintenance, security and/or
monitoring of the Premises as may be required as a result of the existence of any Hazardous Substance in, on, under,
or about the Premises other than Existing HazMat Conditions, or neighboring properties (provided, however, in the
case of neighboring properties, only to the extent that the contamination was caused or materially contributed to by
Lessee). The remediation shall be made as required under applicable laws.
(d) Lessee Indemnification. Lessee shall indemnify, defend and hold Lessor, its elected officials
and employees and staff, lenders, consultants, and counsel, harmless from and against any and all loss of rents and/or
damages, liabilities, judgments, claims, expenses, penalties, and attorneys' and consultants' fees arising out of or
involving any Hazardous Substance located on the Premises (provided, however, that Lessee shall have no liability
under this Lease with respect to Existing HazMat Conditions or migration of any Hazardous Substance to the
Premises from adjacent properties not caused or contributed to by Lessee). Lessee's obligations shall include, but
not be limited to, the effects of any contamination or injury to person, property or the environment resulting from
Hazardous Substance on the Property, and the cost of investigation, removal, remediation, restoration and/or
abatement, and shall survive the expiration or termination of this Lease. No termination, cancellation, or release
agreement entered into by Lessor and Lessee shall release Lessee from its obligations under this Lease with respect
to Hazardous Substances, unless specifically so agreed by Lessor in writing at the time of such agreement.
(e) Investigations and Remediation. Lessee shall be responsible for and pay for any
investigations or remediation measures required by governmental entities having jurisdiction with respect to the
existence of Hazardous Substances on the Premises during the Term except for any Existing HazMat Conditions or
migration of any Hazardous Substance to the Premises from adjacent properties not caused or contributed to by
Lessee. Lessee shall cooperate fully in any such activities, including allowing Lessor and Lessor's agents to have
reasonable access to the Premises at reasonable times in order for Lessor to investigate and monitor any claims and
remediation activities; provided, however, that any such monitoring shall be at the sole option of Lessor, and shall
not negate or lessen Lessee's obligations hereunder.
6.3 Lessee's Compliance with Applicable Requirements. Lessee shall, at Lessee's sole expense, fully,
diligently and in a timely manner, materially comply with all Applicable Requirements (including, without
limitation, the Americans with Disabilities Act and all. applicable environmental laws, except with respect to (a)
Existing HazMat Conditions, or (b) or migration of any Hazardous Substance to the Premises from adjacent
properties not caused or contributed to by Lessee), the requirements of any applicable fire insurance underwriter or
rating bureau, and the recommendations of Lessor's engineers and/or consultants which relate in any manner to the
such Requirements, without regard to whether such Requirements are now in effect or become effective after the
Commencement Date. Lessee shall, within thirty (30) days after receipt of Lessor's written request, provide Lessor
with copies of all Permits and other documents, and other information reasonably evidencing Lessee's compliance
with any Applicable Requirements identified by Lessor, and shall promptly upon receipt, notify Lessor in writing
(with copies of any documents involved) of any threatened or actual claim, notice, citation, warning, complaint or
report pertaining to or involving the failure of Lessee or the Premises to comply with any Applicable Requirements.
7. Renovation of Building; 'Future Alterations.
7.1 The Existing Building. The Premises are presently improved with a Building of approximately
45,000 square feet. Lessee acknowledges hereby that it has researched and inspected the existing Building and other
improvements on the Premises and accepts the same in its present "as-is" condition. The Building, as it may be
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renovated by Lessee, and as it may be further improved during the Term, shall be and remain the property of Lessor,
except as otherwise set forth in this Lease.
7.2 Initial Renovation by Lessee.
(a) Lessee shall use diligent efforts to obtain the Permits that are required for Lessee's renovation
of the Building for the use described in Paragraph 6.1, the terms and conditions of which shall be subject to Lessee's
review and approval in its sole discretion. If Lessee submits its application for the Permits by February 1,2005, and
responds to all reasonable requests for further information and documentation from the City of Vernon on a
reasonably timely basis, but the Permits are not obtained within one hundred and twenty (120) days after the
Execution Date, then Lessee shall have the right to terminate this Lease by delivering written notice to Lessor of
Lessee's intent to terminate within thirty (30) days after the passage of the 120 day period if the Permits are not
issued within such 30 day period.
(b) Following the issuance ofthe Permits, Lessee shall renovate the existing Building for use as an
ice production and food processing and cold storage facility at Lessee's sole cost and expense. The renovation shall
be performed in compliance with all applicable local, state, and federal codes, laws, rules, and requirements, and in
accordance with the working drawings that were submitted to the City of Vernon in connection with obtaining the
Permits (the "Working Drawings"), and in accordance with the Permits, and with first class materials and
workmanship. Lessee shall diligently prosecute the renovation to completion.
7.3 Future Alterations and Improvements. In addition to Lessee's obligation to renovate the Building
as set forth above, subject to Lessee's compliance with the provisions of Section 7 of this Lease, Lessee shall have
the right at any time and from time to time during the Term to make, at its sole cost and expense, such changes and
alterations, structural or otherwise, in or to the Building and Premises as Lessee shall deem necessary or desirable,
including, without limitation, the right to remove and/or demolish the Building and other improvements; provided,
however, that Lessee may not, without the prior written approval of Lessor, which shall not be unreasonably
withheld, demolish the Building (excluding trade fixtures and other Lessee personal property). The Parties agree that
it shall not be unreasonable for the Lessor to withhold or deny its approval if the effect of such removal or demolition
would be to materially reduce the value of the Premises, unless Lessee constructs or causes to be constructed, a new
building and/or other improvements such that the value of the Premises after such construction would be (in Lessor's
reasonable estimation) at least equal to the value of the Premises as improved by the renovation to the Building
described in Paragraph 7.2 prior to such removal and replacement. Without limiting Lessee's obligations related to
renovation or construction as set forth in this Lease, whenever Lessee requests Lessor's approval under this
Paragraph 7.6, Lessee shall provide to Lessor reasonable supportive evidence of Lessee's intent and capacity to
comply with its obligations pursuant to this Paragraph. Following preliminary approval thereof by Lessor, Lessee
shall provide plans, specifications, and working drawings (collectively, the "Plans") for the replacement
improvements prepared by a licensed architect and/or civil engineer, cost estimates for the construction of the
replacement improvements and reasonable evidence of financial capability to complete the replacement construction
as required by this Paragraph 7.6. Subject to delays caused by events of force majeure (with work to commence as
soon as reasonable after the end of the force majeure event), Lessee's failure to commence the construction of the
required replacement improvements approved by Lessor one hundred and eighty (180) days of the removal of said
Building or improvements to be replaced and/or to complete said work of replacement within two (2) years of the
commencement of such work shall constitute a default by Lessee of its obligations under this Lease.
Notwithstanding the foregoing, Lessor's consent shall not be reql1ired for modifications to the Building that do not
affect the roof or structure or cost more than One Hundred Thousand Dollars ($100,000).
7.4 Requirements for Renovation and Future Alterations and Improvements. The following terms
and provisions shall apply to the renovations described in Paragraph 7.2 and to all future alterations or improvements
as described in Paragraph 7.3 above, and Lessee shall comply with each such requirement in connection with such
renovations or future improvements.
(a) Lessee shall deliver to Lessor (i) certificates of insurance evidencing coverage for "builder's
risk", (ii) evidence of worker's compensation insurance covering all persons employed in connection with the
renovation and with respect to whom death or bodily injury claims could be asserted against Lessor or the Premises
and (iii) evidence that Lessee has paid or caused to be paid all premiums for the insurance coverages described in this
paragraph (b) and any increase in premiums on insurance required to be carried under Paragraph 9, sufficient to
assure maintenance of all insurance at sufficient levels during the renovation.
(b) Lessee shall payor cause to be paid the total cost and expense of all works of improvement, as
such phrase is defined in the Mechanic's Lien Law in effect at the time and place of the renovation when the work
begins. Lessee shall not suffer or permit to be enforced against the Premises, or any part thereof, any mechanic's,
materialman's, contractor's or subcontractor's lien arising from any work of improvement, regardless of cause.
However, Lessee may in good faith, and at Lessee's own expense, contest the validity of any such asserted lien,
claim or demand, provided that Lessee has furnished a bond freeing the Premises from the effect of such a lien claim.
(c) Lessee shall protect, defend and indemnify Lessor against all liability and loss of any type
arising out of the renovation or any work of improvement performed on the Premises by Lessee, including reasonable
attorney's fees and all out of pocket costs and expenses incurred by Lessor in negotiating, settling, defending or
otherwise protecting against such claims.
(d) On completion of the renovation or any substantial work of improvement during the term of
this Lease, Lessee shall file or cause to be filed a Notice of Completion. Lessee hereby appoints Lessor as its
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attorney in fact to file the Notice of Completion on Lessee's failu~e to do so after the renovation or any work of
improvement has been substantially completed.
(e) On completion ofthe renovation, Lessee shall give Lessor a copy of the "as built" drawings, or
a marked set of the plans showing all field changes, reflecting all material changes to the Working Drawings.
Changes that do not materially alter the Working Drawings do not require inclusion in such drawings.
7.5 Prohibited Plans.' Notwithstanding anything to the contrary expressed or implied herein, under no
circumstances shall the Plans consist of or include a new building, improvements to the Building, or other
improvements that are not permitted uses under Paragraph 6.1 hereof.
7.6 Grading and Site Preparation. Lessee shall not have the right to change the grade of the Premises,
to excavate and remove any underground obstructions and/or to demolish and remove any foliage and trees situated
upon the Premises as of the Execution Date without the prior written consent of Lessor, which consent shall not be
unreasonably withheld, conditioned or delayed. If the Lessor consents, all such work shall be performed in
accordance with the applicable requirements of this Lease and all applicable Laws.
7.7 Construction and Right to Improvements. Lessee may construct additional buildings and other
structures and improvements upon the Premises; provided that all such construction shall be performed in accordance
with the applicable requirements of this Lease. Lessee covenants with Lessor that all improvements of whatsoever
nature constructed by or under Lessee on the Premises shall be diligently constructed at no cost or expense to Lessor
and in a good and workmanlike manner according to and in conformity with all applicable laws. Any and all such
improvements shall be owned by Lessee during the Term but shall remain a part ofthe Premises and be surrendered
therewith at the end of the Term hereof or sooner termination of this Lease, at which time the same shall become a
part of the realty and the absolute property of Lessor except as otherwise indicated in this Lease.
7.8 Cost and Expense of Improvements. The entire cost and expens~ of constructing any and all
improvements on the Premises shall be borne and paid by Lessee, and Lessee shall indemnify, hold and save Lessor
and the Premises hannless from any liability whatsoever on account thereof.
7.9 Ownership Of Improvements at Termination. All improvements (including the Building as
renovated by Lessee) on the Premises at the expiration of the Term or sooner termination of this Lease shall, without
compensation to Lessee, then become Lessor's property free and clear of all claims to or against them by Lessee or
any third person and Lessee shall defend and indemnify Lessor against all liability and loss (including reasonable
attorneys' fees and costs) arising from such claims against the Building or any other buildings or improvements on
the Premises. Notwithstanding the foregoing, however, all trade fixtures, furniture, equipment, inventory and signs
shall be and remain the property of Lessee and, without excusing Lessee's obligations under the provisions of
Paragraph 6.1, may be removable at any time during the term of this Lease, and, without excusing Lessee's
obligations under the provisions of Paragraph 6.1, Tenant shall have the right to remove any refrigeration, ice
manufacturing, packaging, handling, conveyors or other equipment or machinery installed or constructed by Lessee.
The removal of any such equipment, furniture, fixtures and signs shall be at Lessee's expense and Lessee shall repair
any damage to the Premises or any building or structure thereon occasioned hy the removal. Lessee shall be required
to remove all such equipment, furniture, fixtures, and signs at the end of the Term or other earlier termination of this
Lease, and shall be required to remove any personal property, trade fixtures, or equipment required by law to be
removed from the Premises, , but shall not be required to remove any cabling and lor telecommunications lines.
8. Maintenance; Repairs, and Trade Fixtures.
8.1 Lessee's Obligations.
(a) In General. Except for Existing HazMat Conditions and/or or the migration of any Hazardous
Substance to the Premises from adjacent properties not caused or contributed to by Lessee, and subject to the
provisions of Paragraph 10 (Damage or Destruction), and 15 (Condemnation), Lessee shall, at Lessee's sole expense,
keep the Premises, in good order, condition and repair (whether or not the portion of the Premises requiring repairs,
or the means of repairing the same, are reasonably or readily accessible to Lessee, and whether or not the need for
such repairs occurs as a result of Lessee's use, any prior use, the elements or the age of such portion of the Premises),
including, but not limited to, all equipment or facilities, such as plumbing, HV AC equipment, electrical, lighting
facilities, boilers, pressure vessels, fire protection system, fixtures, walls (interior and exterior), foundations, ceilings,
roofs, roof drainage systems, floors, windows, doors, plate glass, skylights, landscaping, driveways, parking lots,
fences, retaining walls, signs, sidewalks and parkways located in, on, or adjacent to the Premises. Lessee, in keeping
the Premises in good order, condition and repair, shall exercise and perform good maintenance practices. Lessee's
obligations shall include restorations, replacements or renewals when necessary to keep the Premises and all
improvements thereon or a part thereof in good order, condition and state of repair. Lessee shall, during the term of
this Lease, keep the exterior appearance of the Building in a first-class condition (including, M., graffiti removal)
consistent with the exterior appearance of other similar facilities of comparable age and size in the vicinity,
including, when necessary, the exterior repainting of the Building.
(b) Failure to Perform. If Lessee fails to perform Lessee's obligations under this Paragraph 8.1,
Lessor may enter upon the Premises after thirty (30) days' prior written notice to Lessee (except in the case of an
emergency, in which case no notice shall be required), perform such obligations on Lessee's behalf, and put the
Premises in good order, condition and repair, and Lessee shall promptly pay to Lessor a sum equal to 110% of the
cost thereof; provided, however, that if such cure reasonably requires more than thirty (30) days, then Lessor shall
not take any action if Lessee begins such work within thirty (30) days after receipt of notice and thereafter diligently
prosecutes it to completion.
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01910/0007112620.1
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8.2 Lessor's Obligations. Except for Existing HazMat Conditions and/or or the migration of any
Hazardous Substance to the Premises from adjacent properties not caused or contributed to by Lessee, and subject to
the provisions of Paragraphs 10 (Damage or Destruction) and 15 (Condemnation), it is intended by the Parties hereto
that Lessor have no obligation, in any manner whatsoever, to repair and maintain the Premises, or the equipment
therein, all of which obligations are intended to be that ofthe Lessee. It is the intention of the Parties that the terms
of this Lease govern the respective obligations of the Parties as to maintenance and repair of the Premises, and they
expressly waive the benefit of any statute now or hereafter in effect to the extent it is inconsistent with the terms of
this Lease.
8.3 Surrender; Restoration. Subject to Paragraphs 10 (Damage or Destruction) and 15 (Condemnation),
Lessee shall surrender the Premises by the Expiration Date or any earlier termination date, with all of the
improvements, parts and surfaces thereof broom clean and free of debris, and in good operating order, condition and
state of repair, ordinary wear and tear excepted. "Ordinary wear and tear" shall not include any damage or
deterioration that would have been prevented by good maintenance practice. Lessee shall completely remove from
the Premises any and all Hazardous Substances brought onto the Premises by or for Lessee, or any third party under
Lessee's control (except Hazardous Substances which were deposited via underground migration from areas outside
of the Premises, unless such underground migration was related to conduct of Lessee) to the extent required by
applicable law. Any personal property of Lessee not removed on or before the Expiration Date or any earlier
termination date shall be deemed to have been abandoned by Lessee and may be disposed of or retained by Lessor as
Lessor may desire, and Lessee shall pay the cost of the removal, storage, and disposal.
Insurance; Indemnity.
9.1 Payment For Insurance. Lessee shall pay for all insurance required hereunder, commencing with
the Execution Date and ending on the Expiration Date or sooner tennination of this Lease.
9.2 Liability Insurance.
(a) Carried by Lessee. Lessee shall obtain and keep in force a Commercial General Liability
policy of insurance protecting Lessee and Lessor as an additional insured against claims for bodily injury, personal
injury and property damage based upon or arising out of the ownership, use, occupancy or maintenance of the
Premises and all areas appurtenant thereto. Such insurance shall be on an occurrence basis providing single limit
coverage in an amount not less than $3,000,000 per occurrence with an annual aggregate of not less than $5,000,000,
an "Additional Insured-Managers or Lessors of Premises Endorsement" and contain the "Amendment of the
Pollution Exclusion Endorsement" for damage caused by heat, smoke or fumes from a hostile fire. The policy shall
not contain any intra-insured exclusions as between insured persons or organizations, but shall include coverage for
liability assumed under this Lease as an "insured contract" for the performance of Lessee's indemnity obligations
under this Lease. The limits of said insurance shall not, however, limit the liability of Lessee nor relieve Lessee of
any obligation hereunder. All insurance carried by Lessee shall be primary to and not contributory with any similar
insurance carried by Lessor, whose insurance shall be considered excess insurance only.
(b) Carried by Lessor. Lessor, at its sole expense, shall maintain liability insurance as described
in Paragraph 9.2(a), in addition to, and not in lieu of, the insurance required to be maintained by Lessee. Lessee shall
not be named as an additional insured therein.
9.3 Property Insurance - Building, improvements and Rental Value.
(a) Building and Improvements. Lessee shall obtain and keep in force a policy or policies in the
name of Lessee and Lessor, with loss payable to Lessee insuring loss or damage to the Premises. The amount of
such insurance shall be equal to the full replacement cost of all of the improvements on the Premises, as the same
shall exist from time to time,. Such policy or policies shall insure against all risks of direct physical loss or damage
(except the perils of flood and/or earthquake), including coverage for debris removal and the enforcement of any
Applicable Requirements requiring the upgrading, demolition. reconstruction or replacement of any portion of the
improvements on the Premises as the result of a covered loss. Said policy or policies shall also contain an agreed
valuation provision in lieu of any coinsurance clause, waiver of subrogation, and inflation guard protection causing
an increase in the annual property insurance coverage amount by a factor of not less than the adjusted U.S.
Department of Labor Consumer Price index for All Urban Consumers for the city nearest to where the Premises are
located. If such insurance coverage has a deductible clause, the deductible amount shall not exceed $5, 000 per
occurrence, and Lessee shall be liable for such deductible amount in the event of an insured Loss.
(b) Rental Value. Lessee shall obtain and keep in force a policy or policies in the name of Lessee
and Lessor with loss payable to Lessor insuring the loss of the full Rent for one year with an extended period of
indemnity for an additional 180 days ("Rental Value insurance"). Said insurance shall contain an agreed valuation
provision in lieu of any coinsurance clause, and the amount of coverage shall be adjusted annually to reflect the
projected Rent otherwise payable by Lessee for the next 12 month period. Lessee shall be liable for any deductible
amount in the event of such loss.
(c) Builder's Risk Coverage. Before commencement of any demolition or construction at the
Premises, Lessee shall procure,. and shall maintain or cause to be procured and maintained in force until completion
of all works of improvement at tIle Premises, "all risks" builder's risk insurance, including vandalism and malicious
mischief, with limits in the total amount of the construction and the value of all improvements.
9.4 Lessee's Property; Business Interruption Insurance.
(a) Property Damage. Lessee shall obtain and maintain insurance coverage on all of Lessee's
equipment, Trade Fixtures, inventory and other personal property. Such insurance shall be full replacement cost
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9.
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coverage with a deductible of not to exceed $5,000 per occurrence. Subject to Paragraph 10 (Damage and
Destruction), the proceeds from any such insurance shall be used by Lessee for the replacement of Lessee's
equipment, Trade Fixtures, inventory and other personal property. Lessee shall provide Lessor with written evidence
that such insurance is in force.
(b) Business Interruption. Lessee shall obtain and maintain loss of income and extra expense
insurance in amounts as will reimburse Lessee for direct or indirect loss of earnings attributable to all perils
commonly insured against by prudent lessees in the business of Lessee or attributable to prevention of access to the
Premises as a result of such perils.
(c) No Representation of Adequate Coverage. Lessor makes no representation that the limits or
forms of coverage of insurance specified herein are adequate to cover Lessee's property, business operations or
obligations under this Lease.
9.5 Insurance Policies. Insurance required herein shall be by companies duly licensed or admitted to
transact business in the state where the Premises are located, and maintaining during the policy term a "General
Policyholders Rating" of at least B+, V, as set forth in the most current issue of "Best's Insurance Guide". Lessee
shall not do or permit to be done anything which invalidates the required insurance policies. Lessee shall, on or
before the. Execution Commencement Date, deliver to Lessor certified copies of policies of such insurance or
certificates evidencing the existence and amounts of the required insurance. No such policy shall be cancelable or
subject to modification except after 30 days prior written notice to Lessor. Lessee shall, at least 30 days prior to the
expiration of such policies, furnish Lessor with evidence of renewals or "insurance binders" evidencing renewal
thereof, or Lessor may order such insurance and charge the cost thereof to Lessee, which amount shall be payable by
Lessee to Lessor upon demand. Such policies shall be for a term of at least one year, or the length of the remaining
term of this Lease, whichever is less.
9.6 Waiver of Subrogation. Without affecting any other rights or remedies, Lessee and Lessor each
hereby release and relieve the other, and waive their entire right to recover damages against the other, for loss of or
damage to its property arising out of or incident to the perils required to be insured against herein. The effect of such
releases and waivers is not limited by the amount of insurance carried or required, or by any deductibles applicable
hereto. The Parties agree to have their respective property damage insurance carriers waive any right to subrogation
that such companies may have against Lessor or Lessee, as the case may be, so long as the insurance is not
invalidated thereby and is available on commercially reasonable termS.
9.7 Indemnity. Lessee shall indemnify, protect, defend and hold harmless the Premises, Lessor and its
elected officials, staff, employees, agents and representatives, from and against any and all claims, damages, liens,
judgments, penalties, attorneys' and consultants' fees, expenses and/or liabilities arising out of, involving, or in
connection with, the use and/or occupancy of the Premises by Lessee. If any action or proceeding is brought against
Lessor by reason of any of the foregoing matters, . Lessee shall upon notice defend the same at Lessee's expense by
counsel reasonably satisfactory to Lessor and Lessor shall cooperate with Lessee in such defense. Lessor need not
have first paid any such claim in order to be defended or indemnified.
9.8 Exemption of Lessor from Liability. Lessor shall not be liable for injury or damage to the person or
goods, wares, merchandise or other property of Lessee, Lessee's employees, contractors, invitees, customers, or any
other person in or about the Premises, regardless of cause or whether or not such injury or damage results from
conditions arising from the Premises or from other sources or places. Notwithstanding Lessor's negligence or breach
of this Lease, Lessor shall under no circumstances be liable for injury to Lessee's business or for any loss of income
or profit therefrom.
9.9 Failure to Provide Insurance. Lessee acknowledges that any failure on its part to obtain or maintain
the insurance required herein will expose Lessor to risks and potentially cause Lessor to incur costs not contemplated
by this Lease. If Lessee shall fail to procure and maintain the insurance required to be carried by it, Lessor may, but
shall not be required to, procure and maintain the same. Accordingly, for any failure by Lessee to maintain the
required insurance and/or provide Lessor with the required binders or certificates evidencing the existence of the
required insurance or to promptly reimburse Lessor for the cost of any insurance purchased by it after Lessee's
failure to maintain the same, shall constitute a Default and/or Breach of this Lease by Lessee. If Lessor obtains such
insurance for the benefit of Lessee, Lessee shall pay to Lessor 110% of the amount ofthe premium.
10. Damage or Destruction.
10.1 Lessee Restoration Oblil!ation. Subject to the provisions of Paragraph 10.4 below, if at any time
during the Term, the Premises or any part thereof shall be damaged or destroyed by fire, flood, vandalism,
earthquake or other casualty of any kind or nature, Lessee shall proceed promptly and with due diligence to repair,
replace or rebuild the Premises as nearly as possible to their condition and character immediately prior to such
damage with such variations and alterations requested by Lessee as may be approved in writing by Lessor.
10.2 Insurance Proceeds. All insurance proceeds payable to Lessee (except insurance proceeds payable to
Lessor on account of Lessor's loss of Rents proceeds per the insurance carried by Lessee) at any time as a result of
casualty to the Premises shall be 'paid jointly to Lessor and Lessee, but shall be used solely for purposes of payment
for the cost of restoring the Premises, except as may be otherwise expressly set forth herein, and advanced from time
to time for such purposes as the restoration work progresses upon certified request of Lessee's architect. Lessor and
Lessee shall cooperate in order to obtain the largest possible insurance award lawfully obtainable and shall execute
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01910/0007112620.1
any and all consents and other instruments and take all other actions necessary or desirable in order to effectuate
same and to cause such proceeds to be paid as herein before provided.
10.3 No Lease Termination. Except as provided in Paragraph 10.4, this Lease shall not be affected in any
manner by reason of the total or partial destruction of the Premises or any part thereof, or any reason whatsoever, and
Lessee, notwithstanding any applicable law, present or future, waives all rights to quit or surrender the Premises, or
any part thereof, including, but not limited to, Lessee's rights under California Civil Code Sections 1932(2) and
1933(4). Base Rent and Additional Rent required to be paid by Lessee hereunder shall not abate as a result of any
casualty or destruction.
10.4 Uninsured Casualtv. Lessee is relieved of the obligation to, but may, at its option, repair, restore or
reconstruct the Building damaged or destroyed during the final five (5) years of the Term (including any option
period then in effect) if (a) the work of repairing, restoring, or reconstructing would exceed the lesser often percent
(10%) of the replacement cost of the damaged or destroyed Building prior to such damage or destruction or fifty
percent (50%) ofthe Base Rent during the balance ofthe Term; (b) the damage or destruction is uninsured and is not
required to be insured under this Lease; and (c) Lessee complies with all the following conditions:
(i) Lessee must deliver to Lessor notice of the damage or destruction promptly but not
later than sixty (60) days after the event, detailing facts that qualify the casualty under this Section.
(ii) Lessee must continue to make all Rent and other payments when due as required by
this Lease, through the termiuation date.
11. Real Property Taxes.
11.1 Definition. AI> used herein, the term "Real Property Taxes" shall include any form of assessment;
real estate, general, special, ordinary or extraordinary, or rental levy or tax (other than inheritance, personal income
or estate taxes); improvement bond; and/or license fee imposed upon or levied against any legal or equitable interest
of Lessor in the Premises, Lessor's right to other income therefrom, and/or Lessor's business of leasing, by any
authority having the direct or indirect power to tax and where the funds are generated with reference to the common
address of the Premises and where the proceeds so generated are to be applied by the city, county or other local
taxing authority of a jurisdiction within which the Premises are located. Real Property Taxes shall also include any
tax, fee, levy, assessment or charge, or any increase therein: (i) imposed by reason of events occurring during the
term of this Lease, including but not limited to, a change in the ownership of the Premises, and (ii) levied or assessed
on improvements to the Premises during the term of this Lease.
11.2 Payment of Taxes. In addition to Base Rent, Lessee shall pay each Real Property Tax installment
prior to the applicable delinquency date. If any such installment shall cover any period of time prior to or after the
expiration or termination of this Lease, Lessee's share of such installment shall be prorated.
11.3 Personal Property Taxes. Lessee shall pay, prior to delinquency, all taxes assessed against and
levied upon Lessee's Trade Fixtures, furnishings, equipment and all personal property of Lessee.
12. Utilities and Services. Lessee shall pay for all water, gas, heat, light, power, telephone, trash disposal and
other utilities and services supplied to the Premises, together with any. taxes thereon. There shall be no abatement of
rent and Lessor shall not be liable in any respect whatsoever for the inadequacy, stoppage, interruption or
discontinuance of any utility or service due to riot, strike, labor {)ispute, breakdown, accident, repair or other cause
beyond Lessor's reasonable control or in cooperation with governmental request or directions.
13. Assignment and Subletting.
13.1 Lesson Consent Required.
(a) Lessee shall not voluntarily or by operation of law assign, transfer, mortgage or encumber
(collectively, "assign or assignment") or sublet all or any part of Lessee's interest in this Lease or in the Premises
without Lessor's prior written consent which consent Lessor agrees shall not be unreasonably delayed, conditioned or
withheld. Notwithstanding the preceding sentence, Lessee hereby acknowledges and agrees that Lessor may, in its
sole and absolute discretion, withhold consent if the assignee or subtenant intends to use the Premises for a use that is
not the use described in Paragraph 6.1.
(b) A change in the control of Lessee shall constitute an assignment requiring consent. The
transfer, on a cumulative basis, of 49% or more of the voting control of Lessee shall constitute a change in control for
this purpose. Lessor shall approve (i) an assignment of this Lease to an affiliate of Lessee who, in Lessor's
reasonable judgment, , is sufficiently creditworthy to maintain its obligations under this Lease and (ii) a change in
control of Lessee so long as following the change in control, Lessee remains sufficiently creditworthy to maintain its
obligations under this Lease, so long as, in each case, Lessor is given at least 20 days' prior written notice of the
assignment, and, in the case of an assignment to an affiliate, the affiliate executes a commercially reasonable
assignment and assumption agreement, and in either event, there is no change in the use of the Premises. A change
of control or assignment to an affiliate as described in this Paragraph shall be referred to as an "Affiliate
Assignment".
(c) An assignment or subletting without consent shall be null and void, and of no force and effect,
and shall constitute a Breach of this Lease.
(d) Lessee's remedy for any breach of this Paragraph 13.1 by Lessor shall be limited to
compensatory damages or injunctive relief.
13.2 Terms and Conditions Applicable to Assignment and Subletting.
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(a) Regardless of Lessor's consent, no.subletting shall: (i) be effective without the express written
assumption by such sublessee of the obligations of Lessee under this Lease, (ii) release Lessee of any obligations
hereunder, or (iii) alter the primary liability of Lessee for the payment of Rent or for the performance of any other
obligations to be performed by Lessee. No assignment shall be effective without Lessor's consent and the express
written assumption by such assignee of the obligations of Lessee under this Lease. Upon an assignment, Lessee shall
not have any further rights, obligations or liabilities under this Lease.
(b) Lessor may accept Rent or performance of Lessee's obligations from any person other than
Lessee pending approval or disapproval of an assignment.
(c) Lessor's consent to any assignment or subletting shall not constitute a consent to any
subsequent assignment or subletting.
(d) In the event of any Default or Breach by Lessee, Lessor may proceed directly against Lessee
or anyone else responsible for the performance of Lessee's obligations under this Lease, including any sublessee,
without first exhausting Lessor's remedies against any other person or entity responsible therefor to Lessor, or any
security held by Lessor.
(e) Each request for consent to an assignment or subletting shall be in writing, accompanied by
information relevant to Lessor's determination as to the financial and operational responsibility and appropriateness
of the proposed assignee.or sublessee, including but not limited to the intended use and/or required modification of
the Premises, if any, together with a fee of $1,500 as consideration for Lessor's considering and processing said
request. Lessee agrees to provide Lessor with such other or additional information and/or documentation as may be
reasonably requested by Lessor in writing within ten (10) days.
. 13.3 Any assignee of, or sublessee under, this Lease shall, by reason of accepting such assignment or
entering into such sublease, be deemed to have assumed and agreed to conform and comply with each and every
term, covenant, condition and obligation herein to be observed or performed by Lessee during the term of said
assignment or sublease, other than such obligations as are contrary to or inconsistent with provisions of an
assignment or sublease to which Lessor has specifically consented to in writing.
14. Default; Breach; Remedies.
14.1 Default; Breach. A "Default" is defined as a failure by the Lessee to comply with or perform any of
the terms, covenants, or conditions under this Lease. A "Breach" is defined as the occurrence of one or more of the
following Defaults, and the failure of Lessee to cure such Default within any applicable grace period:
(a) Using any portion of the Premises for purposes or on terms other than those set forth in
Paragraph 6.1.
(b) The failure of Lessee to make any payment of Rent required to be made by Lessee hereunder
when due, to provide reasonable evidence of insurance or to fulfill any obligation under this Lease which thereby
endangers or threatens life or property, where such failure continues for a period of five (5) days following written
notice to Lessee.
(c) The failure by Lessee to provide (i) reasonable written evidence of compliance with
Applicable Requirements, (ii) the rescission of an unauthorized assignment or subletting, or (iii) an Estoppel
Certificate where any such failure continues for a period of 30 days following written notice to Lessee.
(d) A Default by Lessee as to the tenus, covenants, conditions or provisions of this Lease, other
than those described in subparagraphs 14.1(a), (b) or (c), above, where such Default continues for a period ono days
after written notice; provided, however, that if the nature of Lessee's Default is such that more than 30 days are
reasonably required for its cure, then it shall not be deemed to be a Breach if Lessee commences such cure within
said 30 day period and thereafter diligently prosecutes such cure to completion.
(e) The occurrence of any of the following events: (i) the making of any general arrangement or
assignment for the benefit of creditors; (ii) becoming a "debtor" as defined in 11 U.S.C. ~101 or any successor
statute thereto (unless, in the case of a petition filed against Lessee, the same is dismissed within 90 days); (iii) the
appointment of a trustee or receiver to take possession of substantially all of Lessee's assets located at the Premises
or of Lessee's interest in this Lease, where possession is not restored to Lessee within 60 days; or (iv) the attachment,
execution or other judicial seizure of substantially all of Lessee's assets located at the Premises or of Lessee's interest
in this Lease, where such seizure is not discharged within 60 days; provided, however, in the event that any provision
of this subparagraph (e) is contrary to any applicable law, such provision shall be of no force or effect, and not affect
the validity of the remaining provisions.
(f) The discovery that any finanoial statement of Lessee given to Lessor was materially false;
provided, however, that any such claim must be asserted by Lessor within twelve (12) months after receipt of such
fmancial statement by Lessor or it shall be deemed waived.
14.2 Remedies. If Lessee fails to perform any of its duties or obligations when due or within ten (10) days
thereafter (or such longer cure period as may be specified above in Paragraph 14.1) upon written notice (or in case of
an emergency, without notice), Lessor may, at its option, perform such duty or obligation on Lessee's behalf,
including but not limited to the.obtaining of reasonably required bonds, insurance policies, or governmental licenses,
permits or approvals. Lessee shall pay to Lessor an amount equal to 110% of the actual, documented costs and
expenses incurred by Lessor in such performance upon receipt of an invoice therefor. In the event of a Breach,
Lessor may, with or without further notice or demand, and without limiting Lessor in the exercise of any right or
remedy which Lessor may have by reason of such Breach:
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(a) Terminate Lessee's right to possession of the Premises by any lawful means, in which case
this Lease shall terminate and Lessee shall immediately surrender possession to Lessor. In such event Lessor shall be
entitled to recover from Lessee: (i) the unpaid Rent which had been earned at the time of termination; (ii) the worth
at the time of award of the amount by which the unpaid rent which would have been earned after termination until
the time of award exceeds the amount of such rental loss that the Lessee proves could have been reasonably avoided;
(iii) the worth at the time of award of the amount by which the unpaid rent for the balance of the term after the time
of award exceeds the amount of such rental loss that the Lessee proves could be reasonably avoided; and (iv) any
other amount necessary to compensate Lessor for all the detriment proximately caused by the Lessee's failure to
perform its obligations under this Lease or which in the ordinary course of things would be likely to result therefrom,
including but not limited to the cost of recovering possession of the Premises, expenses of reletting, including
necessary renovation and alteration of the Premises, reasonable attorneys' fees, and that portion of any leasing
commission paid by Lessor in connection with this Lease applicable to the unexpired term of this Lease. The worth
at the time of award of the amount referred to in provision (Hi) of the immediately preceding sentence shall be
computed by discounting such amount at the discount rate of the Federal Reserve Bank of the District within which
the Premises are located at the time of award plus one percent. Efforts by Lessor to mitigate damages caused by
Lessee's Breach of this Lease shall not waive Lessor's right to recover damages under Paragraph 13. Iftenmnation
of this Lease is obtained through the provisional remedy of unlawful detainer, Lessor shall have the right to recover
in such proceeding any unpaid Rent and damages as are recoverable therein, or Lessor may reserve the right to
recover all or any part thereof in a separate suit. If a notice and grace period required under Paragraph 14.1 was not
previously given, a notice to pay rent or quit, or to perform or quit given to Lessee under the unlawful detainer statute
shall also constitute the notice required by Paragraph 14.1. In such case, the applicable grace period required by
Paragraph 14.1 and the unlawful detainer statute shall run concurrently, and the failure of Lessee to cure the Default
within the greater of the two such grace periods shall constitute both an unlawful detainer and a Breach of this Lease
entitling Lessor to the remedies provided for in this Lease and/or by said statute.
(b) Continue the Lease and Lessee's right to possession and recover the Rent as it becomes due, in
which event Lessee may sublet or assign, subject only to reasonable limitations. Acts of maintenance, efforts to relet,
and/or the appointment of a receiver to protect the Lessor's interests, shall not constitute a termination of the
Lessee's right to possession.
(c) Pursue any other remedy now or hereafter available under the laws or judicial decisions of the
state wherein the Premises are located. The expiration or tenmnation ofthis Lease and/or the termination of Lessee's
right to possession shall not relieve Lessee from liability under any indemnity provisions of this Lease as to matters
occurring or accruing during the term hereof or by reason of Lessee's occupancy of the Premises.
14.3 Late Charges. Lessee hereby acknowledges that late payment by Lessee of Rent will cause Lessor to
incur costs not contemplated by this Lease, the exact amount of which will be extremely difficult to ascertain. Such
costs include, but are not limited to, processing and accounting charges, and late charges which may be imposed
upon Lessor by any Lender. Accordingly, if any Rent shall not be received by Lessor within five (5) days after such
amount shall be due, then, without any requirement for notice to Lessee, Lessee shall immediately pay to Lessor a
one-time late charge equal to five percent (5%) of each such overdue amount or $100, whichever is greater. The
Parties hereby agree that such late charge represents a fair and reasonable estimate of the costs Lessor will incur by
reason of such late payment. Acceptance of such late charge by Lessor shall in no event constitute a waiver of
Lessee's Default or Breach with respect to such overdue amount, nor prevent the exercise of any of the other rights
and remedies granted hereunder. In the event that a late charge is payable hereunder, whether or not collected, for
three (3) consecutive installments of Base Rent, then notwithstanding any provision of this Lease to the contrary,
Base Rent shall, at Lessor's option, become due and payable quarterly in advance for twenty-four (24) months.
14.4 Interest. Any monetary payment due Lessor hereunder, other than late charges, not received by
Lessor, when due or within 10 days following the date on which it was due, shall bear interest from the 11 th day after
itwas due. The interest ("Interest") charged shall be computed at the lesser of 10% per annum or the maximum rate
allowed by law. Interest is payable in addition to the potential late charge provided for in Paragraph 14.3, but interest
shall not be payable on any late charge or other penalty.
14.5 Breach by Lessor. Lessor shall not be deemed in breach of this Lease unless Lessor fails within a
reasonable time to perform an obligation required to be performed by Lessor. For purposes of this Paragraph, a
reasonable time shall in no event be less than 30 days after receipt by Lessor (unless a shorter or longer period is
specified in this Lease for the applicable obligation), and any Lender whose name and address shall have been
furnished Lessee in writing for such purpose, of written notice specifying wherein such obligation of Lessor has not
been performed; provided. however, that if the nature of Lessor's obligation is such that more than 30 days are
reasonably required for its performance, then Lessor shall not be in breach if performance is commenced within such
30 day period and thereafter diligently pursued to completion.
15. Condemnation. If the Premises or any portion thereof are taken under the power of eminent domain or sold
under the threat of the exercise of said power (collectively "Condemnation"), this Lease shall terminate as to the
part taken as of the date the condemning authority takes title or possession, whichever first occurs. If more than ten
percent (10%) of the Premises is taken by Condemnation, Lessee may, at Lessee's option, to be exercised in writing
within ten (10) business days after Lessor shall have given Lessee written notice of such taking (or in the absence of
such notice, within ten (10) business days after the condemning authority shall have taken possession) terminate this
Lease as of the date the condemning authority takes such possession. If Lessee does not terminate this Lease in
Mg--
Page 11 of16
Initials
01910/0007112620.1
accordance with the foregoing, this Lease shall remain in full force and effect as to the portion of the Premises
remaining, except that the Base Rent shall be reduced in proportion to the reduction in utility of the Premises caused
by such Condemnation. Condemnation awards and/or payments shall be the property of both Lessor and Lessee,
depending on whether such award shall be made as compensation for diminution in value of the leasehold, the value
of the improvements which are taken and the value of the part taken, and for severance damages; provided, however,
that in all cases Lessee shall be entitled to any compensation for Lessee's relocation expenses, loss of business
goodwill and/or Trade Fixtures, without regard to whether or not this Lease is terminated pursuant to the provisions
of this Paragraph. All improvements on the Premises including fIXtures and Trade Fixtures, made to the Premises by
Lessee shall be considered the property of the Lessee and Lessee shall be entitled to any and all compensation which
is payable therefor. In the event that this Lease is not terminated by reason of the Condemnation, Lessee shall repair
any damage to the Premises caused by such Condemnation. To the maximum extent pennitted by law, Lessor hereby
waives its right to condemn all or any portion of the Premises or Lessee's interest therein.
16. No Broker or Finder Fees. Each Party hereto (a) represents and warrants to the other Party that such Party
has not engaged or involved a broker or a finder in connection with this Lease that would be entitled to a brokerage
or finder's fee in connection with the consummation of this Lease and (b) hereby agrees to protect, defend and
indemnify the other Party from all claims, demands, damages and liabilities, including court costs and reasonable
attorneys' fees in the event of any breach or such representation and warranty.
17. Estoppel Certificates.
(a) Each Party (as "Responding Party") shall within ten (10) business days after receipt of
written notice from the other Party (the "Requesting Party") execute, acknowledge and deliver to the Requesting
Party a statement in writing in fonn similar to the then most current "Estoppel Certificate" fonn published by the
American Industrial Real Estate Association.
(b) If the Responding Party shall fail to execute or deliver the Estoppel Certificate within such ten
(10) business day period, the Requesting Party may execute an Estoppel Certificate stating that: (i) the Lease is in full
force and effect without modification except as may be represented by the Requesting Party, (ii) there are no uncured
defaults in the Requesting Party's perfonnance, and (iii) if Lessor is the Requesting Party, not more than one month's
rent has been paid in advance. Prospective purchasers and encumbrancers may rely upon the Requesting Party's
Estoppel Certificate, and the Responding Party shall be estopped from denying the truth of the facts contained in said
Certificate.
(c) If Lessor desires to finance, refinance, or sell the Premises, or any part thereof, Lessee shall
deliver to any potential lender or purchaser designated by Lessor such fmancial statements as may be reasonably
required by such lender or purchaser, including but not limited to Lessee's financial statements for the past 3 years.
All such financial statements shall be received by Lessor and such lender or purchaser in confidence and shall be
used oply for the purposes herein set forth.
18. Definition of Lessor. The tenn "Lessor" as used herein shall mean the owner or owners at the time in
question of the fee title to the Premises. In the event of a transfer by the Lessor, the prior Lessor shall be relieved of
all liability with respect to the obligations and/or covenants under this Lease thereafter to be perforrp.ed by the
Lessor. Subject to the foregoing, the obligations and/or covenants in this Lease to be perfonned by the Lessor shall
be binding only upon the Lessor as hereinabove defined.
19. Severability. The invalidity of any provision of this Lease, as determined by a court of competent
jurisdiction, shall in no way affect the validity of any other provision hereof, all of which provisions shall remain in
full force and effect The invalid provision shall be limited to the extent required in order to make it valid and
enforceable, and if necessary, severed from this Lease
20. Days. Unless otherwise specifically indicated to the contrary, the word "days" as used in this Lease shall
mean and refer to calendar days.
21. Limitation on Liability. The obligations of Lessor under this Lease shall not constitute personal obligations
of Lessor or its elected officials, staff, employees, or agents, and the liability of Lessor for any default by Lessor
under this Lease or arising in connection herewith shall be limited solely and exclusively to an amount which is eqnal
to the interest of Lessor in the Premises or the proceeds from the sale thereof. Neither Lessor, nor any of Lessor's
elected officials, staff, employees, agents, or attorneys shall have any personal liability therefor, and Lessee hereby
expressly waives and releases such personal liability on behalf' of itself and of all persons claiming by, through, or
under Lessee. Neither Lessor nor any of Lessor's elected officials, staff, employees, agents, or attorneys shall be
liable under any circumstances for injury or damage to, or interference with, Lessor's business, including, but riot
limited to, loss of profits, loss of revenues, loss of business opportunity, loss of goodwill, or loss of use, in each case,
however occurring.
22. Time of Essence. Time \S of the essence with respect to the perfonnance of au obligations to be perfonned
or observed by the Parties under this Lease.
23. Notices.
23.1 Notice Requirements. All notices required or permitted by this Lease or applicable law shall be in
:g ""dmay Ii, delivered ;n "","on (by ....d... ~:':: may be ,ont by _. _6,d 0' ~~
01910/0007112620.1
or overnight courier, with postage prepaid, or by facsimile transmission, and shall be deemed sufficiently given if
served in a manner specified in this Paragraph 23. The addresses noted adjacent to a Party's signature on this Lease
shall be that Party's address for delivery or mailing of notices. Either Party may by written notice to the other
specify a different address for notice, except that upon Lessee's taking possession of the Premises, the Premises shall
constitute Lessee's address for notice. A copy of all notices to Lessor shall be concurrently transmitted to such party
or parties at such addresses as Lessor may from time to time hereafter designate in writing.
23.2 Date of Notice. Any notice sent by registered or certified mail, return receipt requested, shall be
deemed given on the date of delivery shown on the receipt card, or if no delivery date is shown, the postmark
thereon, if sent by regular mail the notice shall be deemed given 72 hours after the same is addressed as required
herein and mailed with postage prepaid. Notices delivered by overnight courier shall be deemed given on the date of
delivery or the date that delivery is refused. Notices transmitted by facsimile transmission shall be deemed delivered
upon telephone confirmation of receipt (confirmation report from fax machine is sufficient), provided that they are
transmitted on a business day and a copy is also delivered via delivery or mail. If notice is received on a Saturday,
Sunday or legal holiday, it shall be deemed received on the next business day.
24. Waivers. No waiver by Lessor of the Default or Breach of any term, covenant or condition hereof by Lessee,
shall be deemed a waiver-of any other term, covenant or condition hereof, or of any subsequent Default or Breach by
Lessee of the same or of any other term, covenant or condition hereof. Lessor's consent to, or approval of, any act
shall not be deemed to render unnecessary the obtaining of Lessor's consent to, or approval of, any subsequent or
similar act by Lessee, or be construed as the basis of an estoppel to enforce the provision or provisions of this Lease
requiring such consent. The acceptance of Rent by Lessor shall not be a waiver of any Default or Breach by Lessee.
Any payment by Lessee may be accepted by Lessor on account of moneys or damages due Lessor, notwithstanding
any qualifying statements or conditions made by Lessee in connection therewith, which such statements and/or
conditions shall be of no force or effect whatsoever unless specifically agreed to in writing by Lessor at or before the
time of deposit of such payment.
25. No Right To Holdover. Lessee has no right to retain possession of the Premises or any part thereof beyond
the expiration or termination of this Lease. In the event that Lessee holds over, then Lessee shall be a tenant at
sufferance on a month to month basis, and the Base Rent shall be increased to 125% of the Base Rent applicable
immediately preceding the expiration or termination, and Lessee shall comply with all other terms and provisions of
this Lease. Nothing contained herein shall be construed as consent by Lessor to any holding over by Lessee. and
Lessor expressly reserves the right to require Lessee to surrender possession of the Premises to Lessor as provided in
this Lease upon the expiration or earlier termination ofthis Lease. The provisions of this Paragraph 25 shall not be
deemed to limit or constitute a waiver of any other rights or remedies of Lessor provided herein or in law or at
equity. If Lessee fails to surrender the Premises upon the termination or expiration of this Lease, then, in addition to
any other liabilities to Lessor accruing therefrom, Lessee shall protect, defend, indemnify and hold Lessor harmless
from such failure, including, without limiting the generality of the foregoing, any claims made by any succeeding
tenant, or the loss of such tenant, resulting from such failure to surrender and any lost profits to Lessor resulting
therefrom, which lost profits are acknowledged to be foreseeable.
26. Cumulative Remedies. No remedy or election hereunder shall be deemed exclusive but shall, wherever
possible, be cumulative with all other remedies at law or in equity.
27. Covenants and Conditions; Construction of Agreement. All provisions of this Lease to be observed or
performed by Lessee are both covenants and conditions. This Lease shall be construed as though the covenants
herein between the Lessor and the Lessee are independent and Lessee hereby expressly waives the benefit of any
statute to the contrary and agrees that if Lessor fails to perform its obligations set forth herein, Lessee shall not be
entitled to perform any acts at Lessor's expense or to any setoff of the Rent or other amounts owing hereunder
against Lessor except as expressly set forth in this Lease. In construing this Lease, all headings and titles are for the
convenience of the Parties only and shall not be considered a part of this Lease. Whenever required by the context,
the singular shall include the plural and vice versa. This Lease shall not be construed as if prepared by one of the
Parties, but rather according to its fair meaning as a whole, as if both P!lrties had prepared it.
28. Binding Effect; Choice of Law. This Lease shall be binding upon the Parties, their personal representatives,
successors and assigns and be governed by the laws of the State of California. Any litigation between the Parties
hereto concerning this Lease shall be initiated and held in Los Angeles County.
29. Attorneys' Fees. If any Party brings an action or proceeding involving the Premises or this Lease or the
transactions contemplated hereunder, or the relationship between the Parties arising out of or in connection with this
Lease or the Premises, whether founded in tort, contract or equity, or to declare rights hereunder, the Prevailing Party
(as hereafter defined) in any such proceeding, action, or appeal thereon, shall be entitled to recover from the non-
prevailing party, the prevailing party's court costs, costs of other professionals, and reasonable attorneys' fees. Such
costs and fees may be awarded' in the same suit or recovered in a separate suit, whether or not such action or
proceeding is pursued to decision or judgment. The term, "Prevailing Party" shall include, without limitation, a
Party who substantially obtains or defeats the relief sought, as the case may be, whether by compromise, settlement,
judgment, or the abandonment by the other Party of its claim or defense. The attorneys' fees award shall not be
Page 13 of 16
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01910/0007112620.1
computed in accordance with any court fee schedule, but shall be such as to fully reimburse all attorneys' fees
reasonably incurred.
30. Lessor's Access; Showing Premises. Lessor and Lessor's agents shall have the right to enter the Premises at
any time, in the case of an emergency, and otherwise at reasonable times after reasonable prior written (which shall
include fax and email) notice for the purpose of showing the same to prospective purchasers, lenders, or lessees
(during the last six (6) months of the Term). All such activities shall be without abatement of rent or liability to
Lessee.
31. Signs and Advertising upon the Premises. Lessor may not place on the Premises any "For Sale" or "For
Lease" signs except during the last six (6) months of the term hereof. Lessee shall have the right, without the prior
consent of the Lessor, to place any signs or advertising upon the Premises or upon any building thereon, provided
any such sign or advertising is permitted by Applicable Requirements. If the sign is located on the front of the
Premises, Lessee agrees that it must be in conformity with the aesthetic character of the existing building as
reasonably determined by Lessor. Lessee acknowledges that no signs shall be painted on the front of the Building.
32. Termination; Merger. Unless specifically stated otherwise in writing by Lessor, the voluntary or other
surrender of this Lease by Lessee, the mutual termination or cancellation hereof, or a termination hereof by Lessor
for Breach by Lessee, shall automatically terminate any sublease or lesser estate in the Premises; provided, however,
that Lessor may elect to continue anyone or all existing subtenancies. Lessor's failure within ten (10) days
following any such event to elect to the contrary by written notice to the holder of any such lesser interest, shall
constitute Lessor's election to have such event constitute the termination of such interest.
33. Consents. Except as otherwise provided herein, wherever in this Lease the consent of a Party is required to
an act by or for the other Party, such consent shall not be unreasonably withheld, conditioned or delayed. Lessor's.
actual, documented, and reasonable costs and expenses (including but not limited to architects', attorneys',
engineers' and other consultants' fees) incurred in the consideration of, or response to, a request by Lessee for any
Lessor consent, including but not limited to consents to an assignment, a subletting or the presence or use of a
Hazardous Substance, shall be paid by Lessee upon receipt of an invoice and supporting documentation therefor.
Lessor's consent to any act, assignment or subletting shall not constitute an acknowledgment that no Default or
Breach by Lessee of this Lease exists, nor shall such conSent be deemed a waiver of any then existing Default or
Breach, except as may be otherwise specifically stated in 'writing by Lessor at the time of such consent. The failure
to specify herein any particular condition to Lessor's consent shall not preclude the imposition by Lessor at the time
of consent of such further or other conditions as are then reasonable with reference to the particular matter for which
consent is being given, in the event that either Party disagrees with any determination made by the other hereunder
and reasonably requests the reasons for such determination, the determining party shall furnish its reasons in writing
and in reasonable detail within ten (10) business days following such request.
34. Lessee Financing. Lessee's interest in this Lease shall be frnanceable by Lessee; provided, however, that
Lessor shall have the reasonable right of approval of the financing terms to the extent that they relate to the Lessor's
interest in the Premises. The right of any mortgagee ("Mortgagee") having an interest in this Lease to secure
payment by Lessee of an obligation ("Mortgage") shall be subject and subordinate to each of the covenants,
conditions, and restrictions set forth in this Lease and to all rights and interest of the Lessor with respect to the
Premises, except as expressly set forth in this Lease. The documents entered into by and between Lessee and
Mortgagee shall contain provisions that all notices of default under the note shall be sent to Lessor and Lessee, and
that Lessor shall have the right (but not the obligation) to cure any Lessee default that Lessee has failed to cure
within thirty (30) days after the time for Lessee to perform such cure under the terms of this Lease has expired.
Neither Lessor's right to cure any default nor any exercise of such right shall constitute an assumption of liability
under the note or Mortgage. On the recording of the Mortgage, Lessee shall, at Lessee's expense, cause to be
recorded in the office of the Los Angeles County Recorder, a written request executed and acknowledged by Lessor
for a copy of all notices of default and all notices of sale under the Mortgage as provided by applicable California
law. Inclusion in the body of the recorded Mortgage itself of a request for notice having the effect described above
shall constitute compliance with this provision. No Mortgage shall cover any interest in any real property other than
Lessee's interest under this Lease. No Mortgage permitted by this Lease shall cover more than one indebtedness.
35. Quiet Possession. Subject to payment by Lessee of the Rent and performance of all of the covenants,
conditions and provisions on Lessee's part to be observed and performed under this Lease, Lessee shall have quiet
possession and quiet enjoyment of the Premises during the term hereof.
36. Options. Lessee is granted seven (7) options to extend the term of this Lease (each, an "Option"), with each
Option being for a term of ten (10) years. Lessee may exercise each Option by delivering to Lessor twelve (12)
months' prior written notice of its exercise of the Option; provided, however, that the exercise of any Option shall be
subject to the terms of this ParakJ;aph 36.
36.1 Multiple Options. Because Lessee has multiple Options to extend or renew this Lease, a later Option
cannot be exercised unless the prior Options have been validly exercised.
36.2 Effect of Default on Options.
(a) Lessee shall have no right to exercise an Option: (i) during the period commencing with the
~::g of"", noli" ofD.fao1t ond oontimring until ::.:::: ;, "",ad, (H) ""'fig tho p.nod of ti~ ~
01910/0007 112620.1 ~
unpaid beyond the applicable notice and cure period, (iii} during ,the time Lessee is in Breach of this Lease [by
definition, a "Breach" only occurs after the notice and cure period have expired];(iv) if Lessee has been in Default
more than three times during any 12 month period, whether or not the Defaults have been cured; or (iv) if Lessee
has assigned this Lease or subleased all or any portion of the Premises in violation of the terms of this Lease.
(b) The period of time within which,an Option may be exercised shall not be extended or enlarged
by reason of Lessee's inability to exercise an Option because of the provisions of Paragraph 36.2(a).
(c) An Option shall terminate and be of no further force or effect, notwithstanding Lessee's due
and timely exercise of the Option, if, after such exercise and prior to the commencement of the extended term (i)
Lessee two (2) times commits a Default with respect to its obligation to pay Rent, or (ii) there isa material Default of
this Lease that is not cured within the applicable cure period.
37. Performance Under Protest. If at any time a dispute shall arise as to any amount or sum of money to be
paid by one Party to the other under the provisions hereof, the Party against whom the obligation to pay the money is
asserted shall have the right to make payment "under protest" and such payment shall not be regarded as a voluntary
payment and there shall survive the right on the part of said Party to institute suit for recovery of such sum. If it shall
be adjudged that there was no legal obligation on the part of said Party to pay such sum or any part thereof, said Party
shall be entitled to recover such sum or so much thereof as it was not legally required to pay.
38. Authority; Execution.
38.1 If Lessee is a corporation, trust, limited liability company, partnership, or similar entity, each
individual executing this Lease on behalf of such entity represents and warrants that he or she is duly authorized to
execute and deliver this Lease on its behalf, Lessee shall, within 30 days after request, deliver to the other party
satisfactory evidence of such authority.
38.2 This Lease may be executed by the Parties in counterparts, each of which shall be deemed an original
and all of which together shall constitute one and the same instrument.
39. Offer. Preparation of this Lease by either Party or their agent and submission of same to the other Party shall
not be deemed an offer to lease to the othet Party. This Lease is not intended to be binding until executed and
delivered by all Parties hereto.
40, Entire Agreement; Amendments. This Lease, and any attachments incorporated herein by reference,
constitute the entire agreement between the Parties hereto affecting this Lease, and supersedes and replaces any and
all prior or contemporaneous negotiations, arrangements, agreements, discussions, correspondence. letters of intent,
and understandings, whether written or oral, between the Parties hereto with respect to the subject matter set forth
herein. This Lease may be modified only in writing, signed by the Parties in interest at the time of the modification.
Any conflict between the provisions of this Lease and any attachment or addendums shall be controlled by the
addendum or other referenced attachment.
41. Waiver of Jury Trial. Each Party hereto expressly waives any right to trial by jury of any claim, demand,
action, or cause of action arising under this Lease or in connection herewith or related to or arising out of the
transactions contemplated by this Lease or the relationship between the Parties resulting from this Lease,
42. Mandatory Periodic Adjustments; Statutory Changes. In recognition of the long-term nature of this
Lease, all specified dollar amounts set forth herein, including, without limitation, the amounts set forth in Paragraphs
9 (insurance) and 14.3 (late charges) shall be adjusted upwards (but not downwards), concurrently with each
adjustment of the Base Rent under Paragraph 4.2 hereof, to an amount reflecting theinerease in the CPI over the
relevant period, such amount to be calculated in the manner provided in Paragraphs 4.2 and 4.3 hereof. If any
specific section of any statutory law referred to in this Lease is amended, replaced or no longer exists, such section
shall thereafter be deemed to mean (as the case may be) the section so amended, or the section which has replaced or
sUperseded it, or whatever the applicable common law may then be on the subject.
43. Survival. All indemnities, rights, remedies, representations, and warranties contained herein shall survive the
expiration or termination ofthis Lease.
44. Memorandum of Lease. Upon the request of either Party, the Parties shall execute a Memorandum of Lease
suitable for recording in the Official Records of Los Angeles County in a form sufficient to give notice of the tentl of
this Lease.
LESSOR AND LESSEE HA VB CAREFULLY READ AND REVIEWED THIS LEASE AND EACH TERM AND
PROVISION CONTAINED HEREIN, AND BY THE EXECUTION OF THIS LEASE SHOW THEIR INFORMED
AND VOLUNTARY CONSENT THERETO. THE PARTIES HEREBY AGREE TIIAT, AT THE TIME THIS
LEASE IS EXECUTED, THE TERMS OF THIS LEASE ARE COMMERCIALLY REASONABLE AND
EFFEcruATE THE INTENT AND PURPOSE OF LESSOR AND LESSEE WITH RESPECT TO THE
PREMISES.
Executed at: Vernon, California
on: . January 5. 2005
By LESSOR:
Executed at: Vemon, California
on: Dl"t:t?<,ct #u{ 3 'I :1. 00 If
By LESSEE:
~
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01910/0007112620.1
Page 15 of16
City of Vernon UNION ICE-PACIFIC, L.P.,
~~,jifin~~-r.~~fommlimi""_-
Title: ~r . . .
~~e Printed: Bruce V. Malkenhorst
Title: C; 1-y Cl~rk
AS TO FORM: #
By: C_~
Eric T. Frese ~
City Attorney
ATTEST:
APPROVED
.j,;~
Initials
01910/0007 112620.1
Page 16 of16
. .
~
/"
EXHIBIT A
'" t v III 1
,
, ,
EXHIBIT "A"
LEGAL DESCRIPTION
PARCEL J
THAT PORTION OF LOT 31, OF THE 500 ACRE TRACT OF THE LOS ANGELES FRUIT LAND
ASSOCIATION. IN THE CITY OF VERNON. COUNTY OF LOS MJGELES, STATE OF CALIFORNIA, AS PER
MAP RECORDED IN BOOK 3. PAGES 156 AND 157 OF MISCELLANEOUS RECORDS, IN THE OFFICE OF
THE COUNTY RECORDER OF SAID COUNTY. DESCRIBED AS F.)LLOWS:.
BEGINNI~G AT THE NORTHEAST CORNER OF SAID LOT 31; THENCE SOUTH 321.50 FEET ALONG THE
EAST LINE OF SAID LOT 31 TO THE NORTH LINE OF THAT 1".00 FOOT WIDE RIGHT OF WAY OF THE
LOS ANGELES JUNCTION RAILWAY, AS DESCRIBED IN DEED TO CENTRAL MANUFACTURING
DISTRICT INC., RECORDED 4-7-1927, IN BOOK 4752, PAGE 265 OF OFFICIAL RECORDS, IN SAID
RECORDER'S OFFICE; THENCE WEST 387.70 FEET ALONG SAID NORTH LINE OF SAID RIGHT OF WAY
TO THE INTERSECTION OF A LINE THAT IS 387.70 FEET WEST VlEASURED PERPENDICULAR TO AND IS
PARALLEL WITH THE EAST LINE OF SAID LOT 31; THENCr: NORTH 321.50 FEET ALONG LAST SAID
PARALLEL LINE TO THE NORTH LINE OF SAID LOT 31; TIIENCE EAST 387.70 FEET ALONG SAID
NORTH LINE OF SAID LOT 31, ALSO BEING THE CENTERLINE .)F EAST 50TH STREET, 40.00 FEET WIDE,
AS DESCRIBED IN DEED TO THE CITY OF VERNON, RECORDr:D 9-5-1929, AS DOCUMENT NO. 1410, IN
BOOK 9335, PAGE 149 OF OFFICIAL RECORDS, IN SAID RJ:CORDER'S OFFICE, TO THE POINT OF
BEGINNING.
EXCEPT THEREFROM THE NORTH 20.00 FEET OF SAID LOT 31. THE SOUTH LINE OF SAID NORTH 20.00
FEET, ALSO BEING THE SOUTH LINE OF EAST 50TH STREET 41..00 FEET WIpE, AS DESCRIBED IN DEED
TO THE CITY OF VERNON, RECORDED 9-5-1929, AS DOCUME': r NO. 1410, IN BOOK 9335, PAGE 149 OF
OFFICIAL RECORDS. IN SAID RECORDER'S OFFICE.
" ......"" -.......~"
, '
NAME
MAILING
ADDRESS
CITY, STATE
ZIP CODE
RECORDING REQUEST BY
Porter & Hedges, L.L.P.
WHEN RECORDED MAIL TO
George S. Craft
Porter & Hedges, L.L.P.
1000 Main Street,.36th Floor
Houston, TX 77002-6336
~~ ~ V 'l
~ \, ~7DD.
SPACE ABOVE THIS LINE RESERVED FOR RECORDER'S USE
SUBORDINATION, ATTORNMENT AND
NON-DISTURBANCE AGREEMENT
793960_5.DOC
SUBORDINATION, ATTORNMENT AND
NON-DISTURBANCE AGREEMENT
STATE OF CALIFORNIA ~
~ KNOW ALL MEN BY THESE PRESENTS THAT:
COUNTY OF LOS ANGELES ~
WHEREAS, Union Ice-Pacific, L.P., a Califo.rnia limited partnership (herein called
"Union Ice"), is the Lessee pursuant to that certain Ground Lease (herein so called) dated
December 27, 2004, by and between Union Ice, as Lessee, and The City of Vernon, California,
as Lessor (herein so called), and covering the Premises (herein so called) described therein; and
WHEREAS, as of even date herewith, Union Ice has executed a leasehold deed of trust,
(the "Mortgage") in favor of International Bank of Commerce ("Bank"), thereby creating a first
lien and security interest upon the leasehold'estate of the Premises artd all of Union Ice's rights,
titl~ and. interest in the Ground Lease, together with a first lien and security interest on all
fixtures, equipment and personal property located on the Premises for the purpose of securing the
payment of two Real Estate Lien Notes, one in the principal amount of $7,000,000.00 dated
June JdL 2005, and one in the principal amount of $1,500,000.00 dated April 27, 2005, both
executed by Union Ice, payable to the order of the Bank (collectively the "Loan"), to which
reference is herein made for all purposes; and
WHEREAS, the Bank is relying upon the warranties, representations and agreements
contained herein as an inducement to the Bank in making the Lo.an to Union Ice; and
WHEREAS, the Lessor agrees to the attornment by and non-disturbance of the Bank, its
successors and assigns, pursuant to the terms and conditions contained herein.
NOW, THEREFORE, for and in consideration of the premises and other valuable
consideration, the receipt of which is hereby acknowledged, the Lessor and Union Ice hereby
agree, as follows:
1. Bank has been provided with a certified copy of the Ground Lease, which Lesso.r
and Union Ice agree is a true, correct and complete copy of the Ground Lease.
2. The Ground Lease has not been amended or modified. The. Ground Lease has
been du1y authorized and executed by the Lessor and Union Ice and is in. full
I force and effect and neither the Lessor nOr Union Ice is aware of any default in
any respect under the Ground Lease and no notice of defau1t as provided in the
Ground Lease is pending or threatened against Union Ice.
3. Union Ice and Lessor have complied fu1ly and completely with all of their respec-
tive covenants, warranties and other undertakings and obligations under the
Ground Lease to this date, with the resu1t that Union Ice will befully obligated to
pay the rent and other charges due thereunder upon the Rent Commencement
Date (as such term is defined in the Ground Lease), and is fully obligated to'
perform all of the other obligations o.f Union Ice under the Ground Lease. The
793960 _5.DOC 2
793%O_5.DOC
Due Diligence Period (as defined in Section 2.,4 of the Ground Lease) has expired,
and Union Ice did not execute its right to terminate the Ground Lease pursuant to
Section 2.4. Pursuant to Section 7.2(a) of the Ground Lease, Union Ice may
terminate the Ground Lease if the Permits (as defined in the Ground Lease) have
not been issued within the time frame set forth in the Ground Lease.
4.
. Anything in the Ground Lease to the contrary notwithstanding, the Lessor hereby
consents to Union Ice executing the Mortgage in favor of the Bank as part of the
security for the Loan and recording the same of record thereby creating a lien and
security interest on Union Ice's leasehold estate in the Premises and assigning its
rights under the GrOlmd Lease to the Bank; provided, however, that the Mortgage
and all qghts acquired under it shall be subject and subordinate to each and all of
the covenants, co.nditions, obligations, and restrictions set forth in the Ground
Lease and to all rights and interests of Lessor thereunder, and this provision shall
be set forth in the Mortgage.
5.
Union Ice and Lessor agree that as long as the Mortgage is in effect, they shall not
amend the Ground Lease or terminate it voluntarily (except pursuant to the
existing terms thereof, including Lessor's right to terminate the Ground Lease in
the event of a Breach (as defined in the Ground Lease), subject to the right of the
Bank to cure a Breach as set forth herein) prior to the end of its stated initial term
or any extended term (for which Union Ice's option to extend the term has been
timely and properly exercised) without Bank's prior written consent, which shall
not be unreasonably withheld or delayed. The Mortgage shall provide that any
proceeds from fire or extended coverage insurance shall be used for repair or
rebuilding of the Building (as defmed in the Gro.und Lease) or other
improvements on the Premises and not to repay any part of the outstanding Loan.
6.
The Lessor and Union Ice represent to Bank that their respective interests in the
Ground Lease have not been assigned or conveyed and that neither party has
agreed to assign or convey the Ground Lease or any interest therein, except
pursuant to the Mortgage.
7.
If the interest of Union Ice in the Ground Lease is acquired by the Bank by reason
of foreclosure of the Mortgage or other proceedings brought to enforce the rights
of the holder of the Mortgage, by assignment in lieu of foreclosure or.by any other
method, it is agreed that the Ground Lease and the rights and obligations of the
lessee thereunder shall continue in full force and effect and not be terminated or
disturbed except pursuant to the Ground Lease. In the ~vent the Bank or its
successors and assigns take over Union Ice's interest in the Ground Lease; it shall
be bound to the Lessor under all of the terms, covenants and conditions of the
Ground Lease applicable to the lessee for the balance 'Of the term thereof
remaining, and any extensions, or renewals thereof which may be effected in
accordance with any option therefor contained in the Ground Lease with the same
force and effect as if the Bank, its successors and assigns, were the lessee under
the Ground Lease, including the o.bligation of any subsequent lessee (other than
the Bank) to comply with the terms of Section 6.1 of the Ground Lease. The.
3
793%O_5.DOC
Lessor agrees that a takeover of Union Ice's ~nterest under the Ground Lease by
foreclosure, assignment or otherwise will not itself constitute a default under the
Ground Lease. The Bank, its successors and assigns do hereby attorn to the
Lessor, said attornment to be effective and self-operative without the execution of
any other instruments on the part of any party hereto or the Bank, its successors or
assigns immediately upon the Bank, its successors or assigns, succeeding to the
interest of Union Ice under the Ground Lease. The respective rights and obli-
gations of the Bank, its successors or assigns and the Lessor upon such atto.rnment
to the extent of the then remaining balance of the term of the Ground Lease and
any extension or renewal, shall be and are the same as now set forth in the Ground
Lease, it being the intention of the parties hereto for this purpose to incorporate
the Ground Lease into this agreement by reference with the same force and effect
as if set forth at length herein.
8.
Pursuant to Section 34 of the Ground Lease, the Mortgage shall contain
provisions that all notices of default under the Real Estate Lien Notes and the
Mortgage shall be sent to Lessor and Union Ice and that Lessor shall have the
right (but not the obligation) to cure any Union Ice default that Union Ice has
failed to cure within thirty (30) days after the time for Union Ice to' perform such
cure under the terms of the Ground Lease has expired. Neither Lessor's right to
cure any default nor any exercise of such a right shall constitute an assumption of
liability under the Real Estate Lien Notes or Mortgage. If any default is
noncurable, it shall not be grounds for foreclosure of the Mortgage if Lessor, or
lessee in possession of the Premises, promptly performs all other provisions of the
Real Estate Lien Notes and Mortgage. Union Ice and the Bank represent that the
recorded Mortgage includes Lessor's request for a copy of all notices of default
and all notices of sale under the Mortgage in accordance with applicable
California law. Lessor hereby agrees to give Bank, as holder of the Mortgage,
copies of all written notices of any default by Union Ice pursuant to the Ground
Lease and to allow the Bank to cUre the same within thirty (30) days after the time
fo.r Union Ice to perform such cure under the terms of the Ground Lease has
expired (herein called the "Bank Cure Notice") and in the event Bank, or its
successor and assign, elects, at its sole option, to cure such default and does cure
such default, the Lessor shall no.t exercise any of its rights or remedies with
respect to such default under the Ground Lease. Nothing herein shall be
construed as an obligation of the Bank to cure any default under the Ground
Lease. Lessor hereby ackno.wledges receipt of the Mo.rtgage from the Bank.
9.
In the event the Bank elects to cure a default referenced in a Bank Cure Notice,
and in fact cures such default, Union Ice shall continue to be in default pursuant to
the Loan and although an event of default may no longer exist pursuant to the
Ground Lease (as a result of the cure thereof by the Bank), the Bank may exercise
its remedies against Union Ice pursuant to the instruments executed in connectio.n
with the Loan, including, without limitation, fo.rec1osing its lien, security interests
andlor assignment on Union Ice's leasehold estate under the Ground Lease,
provided that any such lien, security interests and/or assignment of Union Ice's
leasehold estate under the Ground Lease will at all times be subject to, and will
4
recognize, the right, title and interest of the Lessor as owner of the land (and
Building and other improvements, as of the termination of the Ground Lease)
covered by the Ground Lease, and the right of the Lessor to require the payment
of all rent and other charges due thereunder and the full and faithful performance
of the covenants and conditions therein, by Union Ice.
10. All notices, requests and communications hereunder shall be in writing or by
facsimile confirmed in writing, and (a) if to Union Ice shall be sufficient in all
respects if delivered or sent by registered or certified mail to Union Ice at the
following address:
Union Ice-Pacific, L.P.
901 East E Street
Wilmingto.n, California 90744
Attention: G. Brent Larson
and (b) if to the Lessor shall be sufficient in all respects if delivered or sent by
registered or certified mail to the Lessor at the following address:
City ofVemon
4305 Santa Fe Avenue
V erno~, Cali(9~a 900;14{. I
AttentIOn:: ~d{ C e:v ~
and (c) if to the Bank shall be sufficient in all respects if delivered or sent by
registered or certified mail to the Bank at the following address:
International Bank of Commerce
5615 Kirby Drive
Houston, Texas 77005
Attn: Real Estate Department
Any party may, by proper written notice hereunder to the other party, change the
address to which notice shall thereafter be sent to it.
This Agreement may be executed in any number of counterparts with the same effect as
if all parties hereunder had signed the same document. All counterparts shall be construed
together and shall constitute one agreement.
EXECUTED this '21 day of June, 2005.
CI1Y OF VERNON, CALIFORNIA
.ff ~
By: ~/~
Name: BruceV.Malkenho.rst
Title: City Administrator/City Clerk
793960 _5.Doe
5
UNION ICE-PACIFIC, L.P., a California
limited partnership
By: UNION ICE GP INC., a Texas
co.rporation, its General Partner
By:
Name:
Title:
INTERNATIONAL BANK OF COMMERCE
By:
Name:
Title:
This instrument was acknowledged before this _ day of June, 2005, by
, in his caI>a' as ~ of The City of
VemOIl, California, for and on beh \ "d~~::'
~fj~/ tKL//llJtjl;OV-
1IiJ- ~~ ",1 f'r
r (!,tJ,~~.JVf" r Notmy Public, State of California
STATE OF CALIFORNIA ~
~
COUNTY OF LOS ANGELES ~
STATE OF TEXAS ~
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COUNTY OF HARRIS ~
This instrument was acknowledged before me on this _day o.f June, 2005, by
, of Union Ice GP Inc., a Texas
corporation, in its capacity as the General Partner o.fUnion Ice-Pacific, L.P., a Califo.mia limited
partnership, for and on behalf of said partnership.
[S E A L]
Notary Public, State of Texas
793%0 _5.DOC
6
CALlFORNIA ALL.PURPOSE ACKNOWLEDGMENT
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acknowledged to me that he/8hefthey executed
the same in hisIREH;'tAe1r authorized
capacity(-ie5), and that by his/Rerftlreir
signature~) on the instrument the person(~), or
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Description of Attached pocument
Title or Type"Of Document: ~D1d. ;rttl-h rn )
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Reorder: Call TolI.Free 1.800.876-6627
Prod. No. 5907
STATE OF TEXAS ~
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This instrument was acknowledged before me on this _ day of _June, 2005, by
of International Bank of Commerce, for
and on behalf of said bank.
[S E A L]
793960 _5.DOC
Notary Public, State of Texas
7
/
Recording Requested by and
When Recorded Return to:
Union Ice-Pacific, L.P.
901 East "E" Street
Wilmington, California 90744
Attention: G. Brent Larson
MEMORANDUM OF LEASE
THIS MEMORANDUM OF LEASE, dated for reference purposes only June 29, 2005, is made
by and between the City of Vernon ("Lessor") and UNION ICE-PACIFIC, L.P.,
a California limited partnership ("Lessee").
The Lessor and Lessee have entered into a Lease dated December 27,2004 (the "Lease") and the
purpose of this Memorandum of Lease is to give record notice of the existence of the Lease and its terms.
1. Premises. The premises consists of approximately 113,000 square feet of land, including
the building located thereon, located at 50th Street in the City of Vernon, County of Los Angeles, State
of California, cOl1ll11only known by the street address of 2970 E. 50th Street, Vernon, California 90058.
The legal description of the property on which the Building is situated is more specifically set forth on
the attached Exhibit A.
2. Term. The term of the Lease is twenty-five (25) years from the Rent Start Date (as
defined in the Lease). Lessee has seven (7) consecutive options, each entitling the Lessee to extend the
term for an additional ten (10) year period.
3. Incorporation by Reference. All prOVISIons set forth. m the Lease are hereby
incorporated by reference in this Memorandum of Lease.
4. Counterparts. This Memorandum may be executed in counterparts, each of which shall
constitute an original and all of which together shall constitute one and the same instrument.
01091/0001 union Ice Memorandum of Lease
(2 )1
01910/0007 116650.1
IN WITNESS WHEREOF, the parties have executed this Memorandum of Lease on the date first
above written.
By LESSOR:
City of Vernon
By: ~
Name Printed: Bruce V. Malkenhorst
Title: City Administrator/City Clerk
By LESSEE:
UNION ICE-PACIFIC, L.P.,
a California limited partnership
By: Union Ice GP Inc.,
a Texas corporation,
its general partner
By:
Name:
Title:
2
01910/0007 116650.1
STATE OF CALIFORNIA)
)SS.
COUNTY OF LOS ANGELES)
ON JUI'le 2Q, 'l15i!C:; , BEFORE ME, THE UN~RSIGNED,ANOTARYPUBLICIN
AND FOR SAID STATE, PERSONALLY APPEARED ruc..e. I/. J..4/LI/<:'.f!AA h();r~--C
PERSONALL Y KNOWN TO ME GR-PROVBD TO ME ON TIlE DASIS OF S}.TI8Y.^..:CTOR:Y
~E TO BE THE PERSON(~) WHOSE NAME(~) IS/~ SUBSCRIBED TO THE WITHIN
INSTRUMENT AND ACKNOWLEDGES TO METHAT HE/SIlL/TIlEY EXECUTED THE SAME IN
HIS/HER/THEIR AUTHORIZED CAP ACITY(IBS), AND THAT BY HIS/HER/THEm
SIGNATURE€&) ON THE INSTRUMENT, THE PERSONE87, OR THE ENTITY UPON BEHALF OF
WHICH THE PERSON(~ ACTED, EXECUTED THE INSTRUMENT.
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~ MANUElAGIRQN
Commission fI. 1328374
~. . . Notary PU. bliC. - California . ~
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STATE OF CALIFORNIA )
)SS.
COUNTY OF LOS ANGELES)
ON , BEFORE ME, THE UNDERSIGNED, A NOTARY PUBLIC IN
AND FOR SAID STATE, PERSONALLY APPEARED
PERSONALLY KNOWN TO ME OR PROVED TO ME ON THE BASIS OF SATISFACTORY
EVIDENCE TO BE THE PERSON(S) WHOSE NAME(S) IS/ARE SUBSCRIBED TO THE WITHIN
INSTRUMENT AND ACKNOWLEDGES TO ME THAT HE/SHE/THEY EXECUTED THE SAME IN
HIS/HER/THEIR AUTHORIZED CAP ACITY(IES), AND THAT BY HIS/HER/THEIR .
SIGNATURE(S) ON THE INSTRUMENT, THE PERSON(S), OR THE ENTITY UPON BEHALF OF
WHICH THE PERSON(S) ACTED, EXECUTED THE INSTRUMENT.
WITNESS MY HAND AND OFFICIAL SEAL.
. (Notary Signature)
3
01910/0007 116650.1
EXIllBIT A
LEGAL DESCRIPTION OF PROPERTY
Parcel 1
THAT PORTION OF LOT 31, OF THE 500 ACRE TRACT OF THE LOS ANGELES FRUIT LAND
ASSOCIATION, IN THE CITY OF VERNON, COUNTY OF LOS ANGELES, STATE OF
CALIFORNIA, AS PER MAP ,RECORDED IN BOOK 3, PAGES 156 AND 157 OF
MISCELLANEOUS RECORDS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID
COUNTY, DESCRIBED AS FOLLOWS:
BEGINNING AT THE NORTHEAST CORNER OF SAID LOT 31; THENCE SOUTH 321.50 FEET
ALONG THE EAST LINE OF SAID LOT 31 TO THE NORTH LINE OF THAT 17.00 FOOT WIDE
RIGHT OF WAY OF THE LOS ANGELES JUNCTION RAILWAY, AS DESCRIBED IN DEED TO
CENTRAL MANUFACTURING DISTRICT, INC., RECORDED 4-7-1927, IN BOOK 4752, PAGE 265
OF OFFICIAL RECORDS, IN SAID RECORDER'S OFFICE; THENCE WEST 387.70 FEET ALONG
SAID NORTH LINE OF SAID RIGHT OF WAY TO THE INTERSECTION OF A LINE THAT IS
387.70 FEET WEST MEASURED PERPENDICULAR TO AND IS PARALLEL WITH THE EAST
LINE OF SAID LOT 31; THENCE NORTH 321.50 FEET ALONG LAST SAID PARALLEL LINE TO
THE NORTH LINE OF SAID LOT 31; THENCE EAST 387.70 FEET ALONG SAID NORTH LINE
OF SAID LOT 31, ALSO BEING THE CENTERLINE OF EAST 50TH STREET, 40.00 FEET WIDE,
AS DESCRIBED IN DEED TO THE CITY OF VERNON, RECORDED 9-5-1929, AS DOCUMENT
NO. 1410, IN BOOK 9335, PAGE 149 OF OFFICIAL RECORDS, IN SAID RECORDER'S OFFICE,
TO THE POINT OF BEGINNING.
EXCEPT THEREFROM THE NORTH 20.00 FEET OF SAID LOT 31, THE SOUTH LINE OF SAID
NORTH 20.00 FEET, ALSO BEING THE SOUTH LINE OF EAST 50TH STREET 40.00 FEET WIDE,
AS DESCRIBED IN DEED TO THE CITY OF VERNON, RECORDED 9-5-1929, AS DOCUMENT
NO. 1410, IN BOOK 9335, PAGE 149 OF OFFICIAL RECORDS, IN SAID RECORDER'S OFFICE.
01091/0001 Union Ice Memorandum of Lease (2)1
01910/0007 116650.1
110 ~-ool
INTEROFFICE MEMORANDUM
RISK MANAGEMENT jPERSONNEL
TO:
FROM:
SUBJECT:
DATE:
ERIC FRESCH, CITY ATTORNEY Y
JOAN PRANCONE, RISK MANAGER _
UNION ICE COMPANY
25 YEAR GROUND LEASE
3/10/2005
Please be advised that the above referenced has provided acceptable insurance coverage.
JF /kr
03-09-05
06:25pm From-DWP/USI Torrance CA
3105423328
T-742 P.001/008 F-525
Dodge Warren & Peters
Insurance Services, Inc.
License #0543895
xl 3625 Del Amo Blvd. #300, Torrance. CA 90503
) 765 The City Drive #300, Orange. CA 92868
) 21731 Ventura Blvd. #300. Woodland Hills, CA91364
) 430 N. Vineyard Blvd #330. Ontario, CA 91764
) 2356 Lillie Ave" P.O. Box 805, Surnmerland. Ca 93067
310-542-4370 F~ 310-542-1803
714-748-0464 Fax 7I 4-748-0474
818-888-2874 Fax 818-888-'-4640
909-937-2040 Fax 909-937-2045
805 565-9600 Fax 805 565-9911
FAX
ROBERT TOERlNG
CITY OF VERNON
323-826-1439
2970 E. 50111 ST.
{including thIs page}
Date:
From:
Phone: :
Insmed:
3/9/05
Carole Mitchell
Union Ice Ltd
Cc: Union lee/ Brett Wffiberg
Dear Mr. Toenng:
\
We are attaching a revised General Liability and Additional Insured endorsement. to
meet specifications of limits of liability, hostile fire amendment to pollution exclusion
arid adding the CG20 11 lessors as additional insured.
When the policy is renewed on 4/1/2005 we will send an updated Certificate fOT the
4/1/2005 to 1/1/2006 policy term.
We also attach a revised Evidence of Property coverage with the Lenders Loss Payable
endorsement in favor of City ofVemon. The Course of Construction policy term is
correct.
Please note that when the Course of Construction is completed, the buJld1ng will be
added to the existing bUSiness package policy, at whIch time the loss of rental
income/business income Will be provided and the All .Risk Property perils. The Course
of Construction policy will then be cancelled.
At this time, the structure is under renovation so is covered by the Builders Risk
Properly policy.
. We trust the enclosed 'Will be found .in order, but please contact us with any further
questions or requests.
Very truly yours. {];v-l
~S,~' -
1'ta "P~
03-09-05
06:25pm
From-DWP/USI Torrance CA
3105423328
T-742 P.002/008 F-525
""'1'1 - ... - - ..- - - -- - . --. -,......-. . . .. .,.... .... .. ~. . ....,..... UNio3-5A~"1 03/09/05
PROOUCE~ THIS CERTIFICATE IS ISSUED AS A MA ITER OF INFORMATION
DWP/US:r Of Southern California ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE
Insu~ance Agency,Inc.-Torra.nce HOLDER. THIS CERTIFICATE DOES NOT AMEND, EXTEND OR
3625 Pel Amo Blvd., #300 ALTJ;R THE COVERAGE AFfORDED BY THE POLICIES BELOW.
Torrance CA 90503- ...
Phone:3~O-542~4370 Fax:310-542-~B03 INSURERS AFFORDING COVERAGE NAIC#
INSUR.!lD INSURER A; Tr~Drt~:e.,loa\ %IJaurMlclt CQ.
INSURER B: American Casu~l tv Co. of
THE UNION ICE CO.,
UNION ICE LTD. INSURER c:
90~ East g Street INSURER 0;
Wilmington CA 90744 INSliAe~ E:
,
COVERAGES
THE POLICIES Or-INSURANCE LISTED SI:LOW HAVE: BE:E;N ISSUED '1'0 THE INSURE;O NAMEO ABOVE FOR THE POLICY PERIOD INDICAteD. N01WITHSTANDING
ANY RE:QUIREMEN'r. TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH FU,SPECTTO WHICH iHIS CERTIF"ICATE MAY' ElE.ISSUIID OR
MAY PERTAIN, TI'451NSuRANCE AFFORDED BY TJotE POLlCII:S DESC:~IBE:D HEREIN IS SUBJECT TO AI.L THE 'rERMS, EXCLUSIONS AND CONDITIONS OF SUCH
POLICIES. AGGREGATE LIMITS SHOWN MAY HAVE BEEN REDUCP.D SY PAID CLAIMS.
lTR 7sR[ TYPE OF fNSI,J~CE f'OUCY NUMBER DA~~MMlODIYW DATE IMMlDolY'i,r LIMITS
GENERAL LIAElIUTr EACH OCCUMl:NCE $1,000,000
-
A X COMMeRCIAL GENERAl. LIABtI.fTY C2055067636 01/01/05 04/01/05 PREMISES iell OCClJrencel $500,000
I CLAIMS MADE [!] OCCu~ MED lOX? {Arly O~" porson/ ,1;10,000
~ HOSTILE FIRE AJQ:loJ;II'IEII'l' TO :E'OLliDTl:OlI' PERSONAL & AI;lV INJU~Y $1,000,000
_ EXCLOS;r;ON GENERALAGGREGAIi:. $2,000,000
GEN'L AGGRnE LIMIT APrilS PER; PRODUCTS. COMP/OP AGG $2,000,000
I POLICY ~f8T X Loe
~TOMOElILe LIABILITY COMBINED SINGLE LIMIT $1,000,000
B x ANY AUTO C2055067653 01/01/05 04/01/05 (E~ accident)
f--
ALL OWNgD AUTOS BODILY INJURY
f---.. $
SCHgJULED AUTOS (Pel p.r:;;l;In)
1- -.
X HIRED AUTOS BODILY INJURy
~ $
1l NON-OWNeD AU'rOS (Pl!lr <u:c1dQnt)
- PROPERTY DAMAGE $
(PBr accident)
GARAGE UABlll1Y AUTO ONLY. EAACCIDENT SO
=j ANY AUT9 OTH6R THAN ,""'ACC ,I;
AUTO ONLY: AGe; SO
EXCESS/UMBRELLA LIABilITY I<ACH OCCURRENCE ,l; 10,000,000
A !!J OCCuR 0 CLAIMS MADe C20SS067667 01/01/05 04/01/05 AGGREGATE: $J.O,OOO,OOO
$
~ DEDUCTIBl.E UM13RELLA $
X RETENTION no,OOO $
WORKERS COIIIIPENSAl'lON AND ~JrORY LIMITS I IO~
EMPLOYERS' UABIUTY
ANY PROPRIETORlPARTNERlEX6C1JTlve E.L EACH ACCIDENT I)
OFFICER/MfiMBER EXCLUDE:D? E.L DISEAse - SA EMPLOYEE $
~~~~liT:~COv'1~grNS below E.L DISEASE - POLICY LIMIT $
OTHER
B AUTO PHYSICAL C20550S7653 01/01/05 04/0J./05 COMP.DED. $1.000
DAMAGE COLL.DaO. $L 000
~ESCR'PTlON OF OPfiRA nONS II.OCATIONSI VEHICLES I EXCLUSIONS ADDED BY ENDORSEMENT I SPECIAl. PROVISIONS
-10 days not:.ice of cancellation IF fer non.payment of p~emium. CITY OF
\TERNON J:S NAMED AS ADD:I:TJ:ONAI, INSORED AS 'l'HEIR :rNTERESTS MAY APPEAR, PER
CG 2011 ~TTACHED. FAXED '1'0: 323-826-1439. RE 2970 E. 50TH ST., VERNOl'f , CA.
90058. PLEASE NOTE UMBRELLA EXCESS POLICY COMBINES W:I:TH GL TO PRO~Da $12
MILLION LIMITS PER OCCURRENCE.
~ERTlFICATE HOLDER
CITY OF VERNON
ATTN: OFFrCE OF CITY CLERK,
ATTN: ROBERT TOERING
4305 SANTA FE AVENUE
V~~O~, CA 90058-0805
CANC~LLA TION
C - VERNo SHOULD ANY OF tHE ABOVfi DESC~IElEO POLICIES BE CANCELLED BEFDRIHHE EXPIRATlO
DATE TlleReOF, THE ISSUING INSURER WILL ~V4JMT~MAIL ~ PAYS WRITTEN
NOTICIil TO THE CERllFICATE HOLDER NAMED TO Tile LEFT. BUT ~SHALL
IMPOSE NO OBUcaTION OR l.IABILlTY OF ANY KI~D UPON THe INSURER, ITS AGENTS OR
ICORD 25 (2001108)
@ACORD CORPORA.TION 1988
03-09-05
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3105423328
T-742 P.003/008 F-525
IMPORTANT
If the certificate holder is an ADDITIONAL INSURED, the policy(ies) must be endorsed. A statement
on this certificate does not confer rights to the certificate holder in lieu of such endorsement(s)_
If SUBR,OGA TION IS WAIVED, subject to the terms and conditions of the policy, certain policies may
require an endorsement. A statement on this certificate does not confer rights to the certificate
holder in lieu of such endorsement(s).
DISCLAIMER
The Certificate of Insurance on the reverse side of this form does not constitute a contract between
the issuing insurer(s), authorized representative' or producer, and the certificate holder, nor does it
affirmatively or negatively amend. extend or alter the coverage afforded by the pOlicies listed thereon.
,CORD 25 (2001J08)
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3105423328
T-742 P.004/008 F-525
Policy Number: C2055067636.....
I
INSURED: Union Ice Ltd
Commercial General Liability
THIS ENDORSEMENT CHANGES THE POLICY, PLEASE READ IT CAREFULLY.
ADDITIONAL INSURED - MANAGERS OR LESSORS
OF PREMISES
This endorsement modifies insurance provided under the following:
COMMERCIAL GENERAL LIABILITY COVERAGE PART.
SCHEDULE
Designationot Premises (Part Leased to You):
2970 E.50TH STREET, VERNON, CA. 90058
Name of Person or Organization:
CITY OF VERNON
4305 SANTA FE A VENUE
VERNON, CA. 90058
(If no entry appears above, information required to complete this endorsement will be shown in
the Declarations as applicable to this endorsement.)
WHO IS AN INSURED (Section II) is amended to include as an insured the person or
organization shown in the Schedule but only with respect to liability arising out of the ownership,
maintenance or use of that part of the premises leased to you and shown in the Schedule and
subject to the following additional exclusions:
This insurance does not apply to:
1. Any "occurrence" which takes place after you cease to be a tenant in that premises.
2. Structural alterations, new construction or demolition operations performed by or on
behalf of the person or organization shown in the Schedule.
CG 20 11 11 85
Copyright, Insurance Services Offices, Inc. 1984
03-09-05 06:25pm. From-DWP/USI Torrance CA 3105423328 T-742 P.005/008
~'. ~"~;; - ;- '" ILI"-':""Jf.,:.~~- ...i,"\-.J!-:~.tl~H~I'.'t.'".;,\:oo.,~O""'tIl'~~~~~.o{J~Jt'.!l:t..,1."'-I~!.~I\:'I~,I;;;,,~~~~~-;;':i1IJ'l':
~~r-w ~" ,...:~_v~mw;_J;Ir~.IM.C\f~"'f~i~mrMi~lf::w.Gil. '~.~i!~:r!h~\~M'A-w{I~~_"M~1~~d.ti~_~.
THIS IS EVIDENCE THAT INSURANCE AS IDENTIFIED BELOW HAS BEEN ISSUE;O, IS IN FORCE, AND CONVEYS ALL THl:
RIGHTS AND PRIVILEGES AFFORDI;D UNDER THE POLICY.
PRO.DUCEiR P~~~::~1: 310-542-4~70310-S42-1aO COMPANY
DWP/USI Of Southern California
Insura~ce Ageney,Inc.-Torrance
3625'Del Amo Blvd., #300
Torranc@ CA 90503-
James C. Martorano
cope;
~USTOMER ID II: UN:r 0 3 SA
INSURE!}
F-525
03/09/05 t!
CNA Property & Casualty Ins.
Dept. #1-1.721
Los Angeles CA 90088-
SUB COPE:
UNION TCE -PACIFIC LP
901 East E Street
Wilmington CA 90744
IOFFECTtve DATE
:BINDER #24724
expIRA'J'ION DATE
CONTINUED UNTIL
TE~INATED IF CHIOCKE:O
LOAN NUMBER
POLICY NUMBER
03/07/05 03/07/06
THIS REPLACES PRIOR EVloe~CIii DATED:
~r~Pf,E~!6il!1'1fl,bRM~~jp~aU~~;~&i*~H~I:g~~rf!:i~Jllj~~m "1 ;~tiit1g[;l.'Zf,~mi~'1li~elr ",1 r.lil!Ji11WM~:~GlIii.~.mJ.'r\_illmt~~~Wj~~ft$.fi:
LOCA1l0NIDESCRIPTlON
001
2970 E. 50TH STREET
VEJ:U;rON CA 90058
RENOVATION O~ AN EXISTING :BUILDING
~~,E~G~IN~~l''t.rd
~, .. \~, ," I .~Wt!m~1l1l\14~~~~~~ml1"~~~.mlillRll'll_:rraa'
COVERAGE/PERILS/FORMS AIIIOUNT OF INSURANCE
DEDUCTleLE
aUlLDERS RZSK COURSE O~ CONSTRUCTZON
S~EClAL FORM PERXLS. INC~UDES CERTAZN SOFT COSTS.
COVERS COST OF RENOVATION/IMP~OVEMENTS
$450 000
$5,000
:BE.M,~1i~~(Ji:i~IUl:Oijg1iSMclal;'Co~C1~io~~~J~j(~~';l;~Y~~H~i~~~~~W!imli~ ~ 'J ',.W'
CNA BUILDERS RISK COVERAGE FORMS AP~LY. WHEN BUILDING lS COMPLETED,
TEE FINrSHED BUILDING WILL BE COVERED UNDER THE aUSINESS PACXAG~
POLrCY FOR SP~ClAL FORM PERILS, iNC~UDING BOSrNESS INCOME.
CP.:HCEE~TIP..~_ '.", -II" I; "~. ~!i~ ""'.! 'I <<.I1,M" "~
THE POLICY IS SUBJE;CT TO THE PREMIUMS, FORMS, AND RULES IN EFFECT FOR EACH POLICY PERIOO. SHOULD THE
POUCY Bl: TERMINATED, THE COMPANY WILL GIVE THE ADDITIONAL INTl:RE:ST IDENTIFIED BELOW *:3 0 DAYS
WRITTEN NO'tICE. AND WILL SEND NOTIFICATION OF ANY CHANGES TO THE POLICY THAT VVOULD AflFECT THAT
INTEREST, IN ACCORDANCl: WITH THE POLICY PROVISIONS OR AS REQUIRED BY LAW.
~D~IJiI0~1!!<:IN~ff~~ Rm!~V . 'l '~~
NAME AND ADCRI:lSS
I . ~ .
~I'
"~~~~. ""~ ~ \ '.;' ~ ~~
CITY OF VERNON
ROBERT TOERING
4305 SANTA FE AVENUE
VERNON CA 90058
\"~cl1!~, .'.1
ADDITIONAL INSURED
AUTHORIZEO REPRESIl:NTA'IlVE
~qp~~ I~,
~d i!ft
41111
. " ~~:lttft;\;liJ.1\~~. '
03-09-05
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POLICY NUMBER:
INSURED: Union Ice Ltd
COMMERCIAL PROPERTY
ISSUE DATE: 12/15/97
THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY
LOSS PAYABLE PROVISIONS
This endorsement modifies insurance provided under the following:
BUILDING AND PERSONAL PROPERTY COVERAGE FORM
BUILDER'S RISK COVERAGE FORM
CONDOMINIUM ASSOCIATION COVERAGE FORM
CONDOMINIUM COMMERCIAL UNIT-OWNERS COVERAGE FORM
STANDARD PROPERTY POLICY
SCHEDUL'=
Premo
No.
Bldg.
No.
Description of Property 2970 E. 50TH, VERNON, CA. 90058
Loss Payee (Name & Address) CITY OF VERNON, 4305 SANTA FE AVENUE, VERNON,
CA. 90058
Loss
Payable
lenders
Loss Payable
x
Contract
of Sale
Provisions Applicable:
A. When this endorsement is attached to the STANDARD PROPERTY POLICY CP 00
99 the term Coverage Part in this endorsement is replaced by the term Policy.
The .following is added to the LOSS PAYMENT Loss Condition, as indicated in the
Declarations or by an "X" in the Schedule:
B. LOSS PAYABLE
For Covered Property in which both you and a Loss Payee shown in the Schedule or in
the Declarations have an insurable interest, we will:
1. Adjust losses with you; and
2. Pay any cl~im for los$ or damage jointly to you and the Loss Payee, as interests may
appear.
CP12181091
Copyright, 1$0 Commercial Risk Services, Inc., 1983, 1990
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C. LENDER'S LOSS PAYABLE
1. The Loss Payee shown in the Schedule or in the Declarations is a creditor, including
a mortgage holder Or trustee, whose interest in Covered Property is established by
such written instruments as:
a. Warehouse receipts:
Q. A contract for deed:
c. Bills of Lading:
d. Financing statements; or
e. Mortgages. deeds of trust, or security agreements.
2. For Covered Property in which both you and a Loss Payee have an insurable
interest:
a. We will pay for covered loss or damage to each Loss Payee in their order of
precedence, as interests may appear.
b. The Loss Payee has the right to receive loss payment even if the Loss Payee has
started foreclosure or similar action on the Covered Property.
c. If we deny your claim because of your acts or because you have failed to comply with
terms of the Coverage Part the Loss Payee will still have the right to receive loss payment if the
Loss Payee:
(1) Pays any premium due under this Coverage Part at our request if you have failed'
to do so:
(2) Submits a signed, sworn proof of loss within 60 days after receiving notice from us
of your failure to do so: and
(3) Has notified us of any change in ownership, occupancy or substantial change in
risk known to the Loss Payee.
All of the terms of this Coverage Part will then apply directly to the Loss Payee.
d. If we pay the Loss Payee for any loss or damage and deny payment to you
because of your acts or because you have failed to comply with the terms of this
Coverage Part:
(1) The Loss Payee's rights will be transferred to us to the extent of the amount we pay:
and
(2) The Loss Payee's rights to recover the full amount of the Loss Payee's claim will not be
impaired.
At our option, we may pay to the Loss Payee the whole principal on the debt plus any accrued
interest. In this event, you will pay your remaining debt to u~.
Page 2 of 3
Copyright, ISO Commercial Risk Services, Inc. 1983, 1990
03-09-05
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310542332S
T-742 P.OOS/OOS F-525
3. If we cancel this policy, we will give written notice to the Loss Payee at least:
a. 10 days before the effective date of cancellation if we cancel for your non- payment of
premium; or
b. 30 days before the effective date of cancellation if we cancel. for any other
reason.
4_ If we elect not to renew this policy, we will give written notice to the Loss Payee at least
10 days before the expiration date of this policy. .
D. CONTRACT OF SALE
1. The Loss Payee shown in the Schedule or in the Declarations is a person or
organization you have entered a contract with for the sale of Covered Property.
2. For Covered Property in which both you and the Loss Payee have an insurable
interest, we will:
a. Adjust losses with you; and
b. Pay any claim for loss or damage jointly to you and the Loss Payee, as interest may
appear.
3. The following is added to the OTHER INSURANCE Condition:
For Covered Property that is the subject of a contract of sale, the word Uyou" includes the Loss
Payee.
Page 3 of 3
Copyright, ISO Commercial Risk Services, Inc. 1983, 1990
..
LEASEHOLD DEED OF TRUST
THE STATE OF CALIFORNIA ~
f KNOW ALL MEN BY THESE PRESENTS:
COUNTY OF LOS ANGELES ~
THAT THE UNDERSIGNED, UNION ICE-PACIFIC, L.P., a California limi~d partnership, d/b/a The
Union Ice Company QIereina:fter called "Trustors," whether one or'more), whose mailing address is 700 Louisiana,
Suite 3920, Houston, Texas 77002, for and in consideration of the debt hereinafter. described, have granted,
bargained, sold and conveyed, and by these presents do grant, bargain, sell and convey, intrust, unto JAY ROGERS
ofHanis County, Texas, as Trustee with power of sale, and unto his successors in the trnst hereby created and unto
his or their assigns and the heirs of such assigns (all of whom are hereinafter called "Trustee"), forever, all the
property described in Exhibit "A" attached hereto and made a part hereof for all pwposes. To have and to hold un~
Trustee and his substitutes, successors aild assigns, with power of sale, the leasehold estate covering that certain
property described in Exhibit "A" (the "Real Property"), which leasehold estate was created pursuant to that certain
Ground Lease Agreement (the "Ground Lease") dated December 27, 2004, executed by Trustors as Lessee and The
City ofVemon as Lessor, together with any and all personal property now or hereafter located thereon and any and
all buildings and improvements of every kind and character now or hereafter situated or placed thereon (including,
but not limited to, any and all plumbing, electrical, heating, cooling and other fixtures, equipment.and appliances),
and all replacements of and additions thereto, and all ofTrostors' rights with respect to utility capacity, utilities and
utility taps, wastewater capacity, proceeds arising from any claim pursuant to any policy of title insurance covering
the property descnbed in Exhtbit "A" and all and singular the rights, privileges, hereditaments, appurtenances, rents,
revenues, profits and income thereunto now or hereafter incident or belonging thereto (collectively referred to herein
as the "Mortgaged Property"), forever and Trustors do hereby bind themselves, their heirs, successors, assigns and
legal representatives to warrant and forever defend, all and singular the Mortgaged Property unto the Trustee, his
substitutes or successors and assigns forever, against the claim or claims of all persons to claim the same or any part
thereof. It is hereby agreed that to the extent permitted by law all of the foregoing property is to be deemed and held
to be a part of and affixed to the realty. _
This conveyance is made in trust with. power of sale, to secure and enforce the payment of two promissory
notes dated of even date herewith. executed oy Tmstors, payable to the order of INTERNATIONAL BANK OF
COMMERCE (hereinafter called "Benenciary"), whose mailing address is P.O. Box 6568, Houston, Texas
77285-6568. one in the original principal amount of $7,000,000.00, and one in the original principal amount of
$1,500,000.00, both bearing interest and being payable as provided therein (hereinafter collectively referred to as the
"Note").
This Deed of Trust shall secure, in addition to the Note, all funds hereafter advanced by Beneficiary to or
for the benefit of Tmstors, as contemplated by any Covenant or provision herein contained. All indebtedness
secured hereby shall be payable in Harris County, Texas, until Beneficiary gives written notice to Tmstors
designating another place of payment; and unless otherwise provided in the instmment evidencing said
indebtedness, shall bear interest at the maximum non-usurious rate allowed by applicable law. If the Note or any
other indebtedness secured hereby shall be collected by legal proceedings or through a probate or bankiuptcy court
or shall be placed in the hands of an attorney for collection after maturity, whether matured by the expiration of time
or by the option given to the Beneficiary to mature same, Trustors agree that all attorneys'. or collection fees as
provided for in the Note shall be paid by Trustors and shall be a part of the indebtedness secured hereby. This Deed
of Trust shall also secure all renewals, rearrangements and extensions of any o~the indebtedness secured hereby.
Better to secure payment of gaid indebtedness, Trustors do hereby jointly and severally covenant and agree
with the Beneficiary and with the Trustee as follows:
(1) Tmstors will pay all of the indebtedness secured hereby, together with the interest and other
appurtenant charges thereon, when the same shall become due in accordance with the terms of the Note or other
instruments evidencing said indebtedness or evidencing any renewal or extension of the same or any part thereof
iManage _790822_1
(2) Trustors have, in their own right, good and leasehold title to the Mortgaged Property, which is free
from encumbrance superior to the liens and security interests hereby created unless otherwise herein provided and
have full right and authority to make this conveyance. Trustors shall at all times comply with and perform all
obligations under any applicable laws, statutes, regulations, covenants, restrictions or ordinances relating to the
Mortgaged Property.
(3) Trustors will keep all buildings and other property covered by this Deed of Trust insured against
fire, lightning, tornado, hail, explosion and against such other risks as Beneficiary may require, all in amounts
approved by Beneficiary. In addition to the above required insurance, Trustors will keep all buildings and other
property covered by this Deed of Trust and all personal property covered hereby or covered by any other instrument
securing payment of the Note insured for the term of the Note with flood insurance in an amount at least equal to the
outstanding principal of the Note or to the maximum limit of coverage made available with respect to the particular
type of property under the National Flood Insurance Act of 1968, whichever is less. Such flood insurance is
required heremtder only when such property is located or to be located in an area that has been identified by the
Secretary of Housing. and Development as an area having special flood hazards and in which flood insurance has
been made available under the National Flood Insurance Act of 1968. Such insurance is to be written in form and in
companies acceptable to the Beneficiary with mortgagee clauses of standard form in favor of Beneficiary and will
deliver the policies ot insurance to the Beneficiary promptly as issued; and, in case the Tmstors fail so to do,
Beneficiary, at its option, may procure such insurance at Trustors' expense. All renewal and substitute policies of
insurance shall be delivered at the office of Bene:6ciary, premiums paid, at least ten (10) days before tennination of
policies theretofore delivered to Beneficiary. All policies shall provide, by way of riders, endorsements or other-
wise, that the insurance provided thereby shall not be tennin~d, reduced or otherwise limited, regardless of any
breach of the representations and agreements set forth therein and that the interest of the Beneficiary will not be
invalidated by any act or omission of the Trustors and that no such policy shall be canceled, endorsed or amended to
any extent unless the issuer thereof shall have first given Beneficiary at least fifteen (15) days prior written notice.
In case Trustors fail to furnish such policies, Beneficiary, at its option, may procure such insurance at Trustors'
expense. in case of loss, Beneficiary, at its option, shall be entitled to receive and retain the proceeds of the
insurance policies, applying the same toward payment of said indebtedness as Beneficiary shall see fit or, at
B~eficiary's option, Beneficiary may pay the same over wholly or in part to Trustors for the repair of said building
or buildings or for the erection of a new building or buildings in their place or for any other purpose satisfactory to
Beneficiary, but Beneficiary shall not be obligated to see to the proper application of any amount paid over to
Trustors. If Beneficiary elects to allow payment of all or part of such proceeds to Trustors, such payments shall be
disbursed on such terms and subject to such conditions as Beneficiary may specify. Should Beneficiary elect to
allow Trustors to repair such damage, Trustors agree that, regardless of whether any insurance proceeds payable to
them are sufficient to pay the costs of repair and restoration of the Mortgaged Property, Trustors shall promptly
commence and carry out the repair, replacement, restoration and rebuilding of any and all of the Mortgaged Property
damaged or destroyed by fire or other casualty so as to return same, to the extent practicable, to its condition
immediately prior to such damage to or destruction thereof TrUstors shall not permit or carry on any activities
within or relating to the Mortgaged Property that is prohibited by the terms of any insurance policy covering any
part of the Mortgaged Property or which permits cancellation of or increase in the premium payable for any
insurance policy covering any part of the Mortgaged Property. In the event of a foreclosure of this Deed of Trust,
the purchaser of the ~ortgaged Property shall succeed to all the rights ofTrustors, including any right to unearned
premiums, in and to all policies of insurance assigned and delivered to Beneficiary pursuant to the provisions of this
Deed of Trust. Regardless of the types or amounts of insurance required and approved by Beneficiary, Trustors
shall as{ign and deliver to Beneficiary all policies of insurance that insure against any loss or damage to the
Mortgaged Property as collateral and further security for the payment of the Note and any other indebtedness
secured hereby. Trustors shall also obtain and maintain in force and effect sueh liability and other insurance policies
and protection as'Beneficiary may from time to time specifY.
(4) Trustors will pay all taxes and assessments against the Mortgaged Property including, without
limitation, all taxes in lieu of ad valorem taxes as the same become due and payable. In the event of the passage
after date of this Deed of Trust of any law by the State ofCalifomia deducting from the Mortgaged Property for the
purposes of taxation any lien thereon or changing in any way the laws now in force for the taxation of mortgages,
deeds of trust or indebtedness secured thereby for State or local purposes or the manner of the operation of any such
taxes so as to affect the interest of Beneficiary, then, and in such event, Trustors shall bear and pay the full amount
of such taxes. IfTrustors fail to pay any such taxes and assessments including, without limitation, taxes in lieu of ad
iManage _790&22 _ t
2
valorem taxes and taxes against this Deed of Trust or said indebtedness secured hereby, Beneficiary may pay the
same, together with all costs and penalties thereon, at Trustors' expense; provided, however, that if, for any reason,
payment by Trustors of any such new or additional taxes would be unlawful or if the payment thereof would
constitute usury or render said indebtedness wholly or partially usurious under any of the terms or provisions of the
Note or this Deed of Trust or otherwise, Beneficiary may, at its option, declare the indebtedness secured hereby,
with all accrued interest thereon, to be immediately due arid payable or Beneficiary may, at its option, pay the
amount or portion of such taxes as renders the indebtedness secured hereby unlawful or usurious, in which event
Trustors shall concurrently therewith pay the remaining lawful and non-usurious portion or balance of said taxes.
(5) All judgments, decrees, awards or payment for injury or damage to the Mortgaged Property and all
awards pursuant to proceeding for condemnation thereof, including interest thereon, are hereby assigned in their
entirety to the Beneficiary, who may apply the same first to reimbursement of all costs and expenses incurred by
Beneficiary in connection with such condemnation proceeding and the balance to the indebtedness secured hereby in
such manner as it may elect; and Beneficiary is hereby authorized, in the name of Trustors, to execute and deliver
valid acquittances for and to appeal from any such award, judgment or decree.. Trustors shall promptly notify
Beneficiary of the institution .or threatened institution of any proceeding for the condemnlltion of any of the /
Mortgaged Property. Beneficiary shall have the right to participate in any such condemnation proceeding.
(6) If, while this trust is in force, the title of the Trustee to the Mortgaged Property or any part thereof
shall be endangered or shall be attacked directly or indirectly, Trustors hereby authorize the Beneficiary, at Trustors'
expense, to take all necessary and proper steps for the defense of said title, including the employment of counsel, the
prosecution or defense of litigation and the compromise or discharge of claims made against said title.
(7) If, in pursuance of any covenant herein contained, the Beneficiary shall payout any money
chargeable to Trustors or subject to reimbursement by Trustorsunder the terms of said covenant or agreement,
Trustors will repay the same to Beneficiary immediately at the place where the Note or other indebtedness hereby
secUred is payable, together with interest thereon at the maximum non-usurious rate allowed by applicable law from
and after the date of Beneficiary's making sUyh payment The sum of each such payment shall be added to the Note
and thereafter shall form a part of the same; and it shall be secured by this Deed of Trust and by subrogation to all
the rights of the person, corporation or body politic receiving such payment
(8) Trustors will keep every part of the Mortgaged Property in first-class condition and presenting a
first-class appearance, making promptly all repairs, renewals and replacements necessary to such end and doing
promptly all else necessary to such end; but Trustors will discharge all claims for labor performed and material
furnished therefor; and will not suffer any lien of mechanics or materialmen therefor to attach to any part of the
Mortgaged Property; and Trustors will guard every part of the Mortgaged Property .from removal, destruction and
damage, and will not do or suffer to be done any act whereby the value ofany part of the Mortgaged Property may
be lessened. No building or other property now or hereafter covered by the lien of this Deed of Trust shall be
removed, demolished or materially altered or enlarged, nor shall any new building be constructed, without the prior
written consent of Beneficiary. Trostors shall not initiate, join in or con~ent to any change in any private restrictive
covenants, zoning ordinances or other public or private restrictions limiting or defining the uses that may be made of
the Mortgaged Property or any part thereof without the prior written consent of Beneficiary. Beneficiary and its
agents or representatives shall have access to the Mortgaged Property at all reasonable times in order to inspect same
and verify Trustors' compliance with their duties and obligations under this Deed of Trust Trustors shall not,
without prior written approval of Beneficiary, grant, conveyor otherwise create or permit to be created, any type of
mortgage, lien, security interest or other encumbrance on any of the Mortgaged Property, regardless whether same
shall be inferior and subordinate to the liens and security interests of Beneficiary in and to the Mortgaged Propertyo
(9) Trustors shall not sell, transfer, assign or mortgage all or any portion of the Mortgaged Property
(including any utilities, utility capacity, utility taps or any rights or interests thereto), nor shall Trustors grant any
easement, right-of-way or file of record any restrictive covenants or restrictions whatsoever with respect to the
Mortgaged Property, nor shall Trustors rent or lease any or all of the Mortgaged Property for a period in excess of
one (1) year without the express written consent of the Beneficiary. IfTrustors are a corporation or partnership, any
sale of cOJporate stock or partnership interests shall constitute a sale of the Mortgaged Property for the purposes
hereof.
Manage _790822_1
3
(10) In the event the ownership of the Mortgaged Property or any part thereof becomes vested ina
person other than Trustors, Beneficiary may, without notice to Trustors, deal with such successor or successors in
interest with reference to this Deed of Trost and to said indebtedness in the same manner as with Trostors, withollt in
any way vitiating or discharging Trustors' liability hereunder or upon said indebtedness. No sale of the Mortgaged
Property and no forbearance on the part of Beneficiary and no extension of the time for the payment of said
indebtedness given by Beneficiary shall operate to release, discharge, modify, change or affect, either in whole or in
part, any original liability of Trustors. or the liability of the guarantors or sureties of Trostors or of any. other party
liable for payment of said indebtedness or any part thereof
(11) In the event Trustors shall default in the prompt payment when due of the indebtedness secured
hereby or any part thereof or any part of any indebtedness ofTrustors to any other person or entity, or fail to keep
and perform any of the covenants or agreements herein contained; or in the event any of the representations or
warranties made to Beneficiary or set forth herein prove to be false; or in the event Trustors or any person liable for
the indebtedness secured hereby or any part thereof file a voluntary petition in bankruptcy, make an assignment for
the benefit of any creditor or are adjudicated a bankrupt or insolvent or if the Mortgaged Property is placed under
control orin th~ custody of any court or if the Trustors abandon any of the Mortgaged Property; then the
Beneficiary, at its option, may declare the entire indebtedness secured hereby immediately due and payable,
whereupon it shall be so due and payable.
(12) All of the covenants and agreements of Trustors set forth herein shall survive the execution and
delivery of this Deed of Trust and shall continue in force until the indebtedness secured hereby is paid in full.
Accordingly, if Trustors shall perform faithfully each. and all of the covenants and agreements herein contained,
then, and then only, this cOnveyance shall become null and void and shall be released in due form at Trustors'
expense; otherwise, it shall remain in fullforce and effect No release of this conveyance or thellen th~reof shall be
valid unless executed by the Beneficiary.
(13) If Trustors shall fail to perform faithfully any covenant or agreement herein contained, Trustors
hereby authorize and empower the Trustee and each and all of his successors in. this trust? at the request of the
Beneficiary, at any time when Trustors shall be in default in the performance of any such covenant or agreement, to
sell the Mortgaged Property in accordance with applicable law. Trustors do hereby authorize and empower Trustee
and each and all of his successors in this trust to sell the Mortgaged Property or any interest or estate in the
Mortgaged Property, together or in lots or parcels, as such Trustee shall deem expedient and to execute and deliver
to the purchaser or purchasers of the Mortgaged Property good and sufficient deed or deeds of conveyance thereof
and bills of sale with covenants of general warranty binding on Trustors and Trustors' respective heirs, legal repre-
sentatives, successors and assigns. J'l1l$tee making .such sale sha,l1 receive the proceeds thereof and shall apply the
same as follows: (a) he shall pay the reasonable expense of executing this trust, including a commission to himself
oftive percent (5%) of the gross proceeds of the sale; (b) after paying such expenses, he shall pay, so far as maybe
pOSSIble, the indebtedness hereby secured, discharging first that portion of said indebtedness arising under the
covenants or agreements herein contained and not evidenced by note; (c) then. he shall pay, so far as may be
possible, the indebtedness secured by any liens equal or superior to the lien created hereby; and (d) he shall pay the
residue, if any, in accordance with applicable law. Payment of the purchase price to the Trustee shall satisfy the
obligation of the purchaser at such sale therefor and he shall not be bound to look after the application thereof.
(
(14) If the herein-named Trustee shall die or become disqualified from acting in the execution of this
trust or shall fail or refuse to execute the same when requested by Beneficiary so to do or if, for any reason,
Beneficiary shall prefer to appoint a substitute trustee to act instead of the herein-named Trustee, Beneficiary shall
have full power to appoint, by written instrument, a substitute trustee and, if necessary, several substitute trustees in
succession, who shall succeed to all the estate, rights, powers and duties of Trustee named herein and no notice of
such appointment need be given to Trustors or to any other person or filed for record in any public office. Such
appointment may be executed by aily authorized agent of the Beneficiary; and such appointment executed in its
behalf by any officer of such entity shall be conclusiveLy presumed to be executed with authority and shall be valid
and sufficient without proof of any action by the board of directors or any superior officer of such entity. Trustors
severally hereby ratifY and confmn any and all acts that Trustee, or his successor or successors in this trust shall do
lawfully by virtue hereof. Trustors hereby agree, on behalf of Trustors and of Trustors' heirs, legal representatives,
successors and assigns, that the recitals contained in any deed or deeds or other instrument executed in due form by
any Trustee or substitute trustee acting under the provisions of this Deed of Trust shall be prima facie evidence of
iMannge _79OS22_1
4
the facts recited and that it shall not be necessary to prove in any court, otherwise than by such recitals, the existence
of the facts essential to authorize the execution and delivery of such deed or deeds or other instrument and the
passing of title thereby and all prerequisites and requirements of any sale or sales shall be conclusively presumed to
have been performed and all persons subsequently dealing with the Mortgaged Property purported to be conveyed
by such deed or deeds or other instrument including, without limitation. the purchaser or purchasers thereof, shall be
fully protected in relying upon the truthfulness of such recitals.
(15) The purchaser at any trustee',s or foreclosure sale hereunder, may disaffirm any easement granted
or rental or lease contract made in violation of any provision of this Deed of Trust and may take immediate
possession of the Mortgaged Property free :from and despite the terms of such grant of easement and rental or lease
contract.
(16) The Beneficiary may bid and become the purchaser of the Mortgaged Property at any trostee's or
foreclosure sale hereunder.
(17) Subsequent to default hereunder or default pursuant to the Note or any other instrument securing
payment thereof, Trustors hereby authorize the Beneficiary, if and whenever it shall desire, to demand and receive,
in Trustors' right, all sums that may become due under any and each oil, gas, mineral or other lease, rental contract
and easement contract pertaining to any portion of the Mortgaged Property and, when received, to apply the same on
the indebtedness secured hereby. No demand for and no receipt or application of any such sum shall be deemed to
minimize, subordinate or affect in any way the liens and rights hereunder of the Beneficiary or any rights of a
purchaser of the Mortgaged Property at trustee's or foreclosure sale hereunder as against the person from whom
such sum was demanded or received or his executors, administrators or assigns or anyone claiming under such lease,
rental. or easement contract
(18) Any part of the Mortgaged Property may be released by the Beneficiary without affecting the lien
hereof against the remainder. The lien and rights hereby granted shall not affect or be affected by any other security
taken for the same indebtedness or any part thereof. The taking of additional security or the.extension, renewal or
rearrangement of the same indebtedness or any part thereof, shall at no time release or impair the lien and rights
granted hereby or affect the liability of any endorser or surety or improve the right of any junior lienhoWer, and this
Deed of Trust, as well as any instrument given to secure any renewal or extension of the indebtedness secured
hereby or any part thereof, shall be and remain a first and prior lien on aU of the Mortgaged Property not expressly
released until the said indebtedness is completely paid.
(19) The invalidity or unenforceability in particular circumstances of any provision of this Deed of
Trust shall not extend beyond such provision or such circumstances and no other provision of this Deed of Trust
shall be affected thereby. It is the intention of the parties hereto to comply with applicable usury laws; accordingly,
it is agreed that, notwithstanding any provisions to the contrary in the Note, or any instrument evidencing any
indebtedness secured hereby, in this Deed of Trust or many of the documents or instruments securing payment of
said indebtedness or otherwise relating thereto, in DO event shall the Note or such documents require the payment or
permit the collection of interest in excess of the maximum amount permitted by such laws. If any such excess of
interest is contracted for, charged or received under the Note or any instrument evidencing said indebtedness under
this Deed of Trust or Uncter the terms of any of the other documents securing payment of said .indebtedness or other-
wise relating thereto or in the event the maturity of any of said indebtedness is accelerated in whole or in part or in
the event that all or part of the principal or interest of said indebtedness shall be prepaid so that, under any of such
circumstances, the amoUllt of interest contracted for, charged or received under the Note or any instruments
evidencing said indebtedness under this Deed of Trust or under any of the ~truments securing payment of said
indebtedness or otherwise relating thereto on the amount of principal actually outstanding from ~e to time under
the Note and other instruments evidencing said indebtedness shall exceed the maximum amount of interest permitted .
by applicable usUty laws, then. in any such event, (a) the provisions of this paragraph shall govern and control,
(b) neither Trustors nor any other person or entity now or hereafter liable for the payment of the Note or any
instrument evidencing said indebtedness shall be obligated to pay the amount of such interest to the extent that it is
in excess of the maximum amount of interest permitted by applicable usury laws, (c) any such excess that may have
been collected shall be either applied as a credit against the then Ullpaid principal amount of the Note or refunded to
Trustors, at the holder's option, and (d) the effective rate of interest shall be automatically reduced to the maximum
non-usurious rate allowed under applicable usury laws. as now or hereafter construed by the courts having juris-
iMaoage _790822_1
5
diction thereof. It is further agreed that, without limitation of the foregoing, all calculations of the rate of interest
contracted for, charged or received under the Note or any instrument evidencing said indebtedness under this Deed
of Trust or under such other documents that are made for the purpose of deteIDlining whether such rate exceeds the
maximum non-usurious applicable rate, shall be made, to the extent permitted, by amortizing, prorating, allocating
and spreading in equal parts during the period of the full stated term of the loans evidenced by the Note or the
instruments evidencing said indebtedness, all interest at any time contracted for, charged or received from Tmstors
or otherwise by the holder or holders hereof in connection with such loans.
(20) None of the Trustors, their heirs, executors, administrators or assigns, ever shall have or assert any
right under any statute or rule of law pertaining to the marshaling of assets, the exemption of homestead, the
administration of estates of decedents or other matter whatever to defeat, reduce or affect the right of the Beneficiary
under the terms of this Deed of Trust to a sale of the Mortgaged Property for the collection of said indebtedness
(without any prior or different resort for collection) or the right of Beneficiary under the teIDlS of this Deed of Trust
to the payment of such indebtedness out of the proceeds of sale of the Mortgaged Property in preference to. every
other person and claimant whatever (only reasonable expenses as aforesaid being first deducted).
(21) It is agreed that if default be made in the payment of any installment of the Note, the holder of the
indebtedness or any part thereof on which the payment is delinquent shall have the option to proceed with
foreclosure in satisfaction of such item, either through the courts or by directing the Trustee or his successors in trust
to proceed as ifunder a full foreclosure, conducting the sale as herein provided and without declaring the whole debt
due and provided that, if sale is made because of default of an installment or a part of an installment, such sale may
be made subject to the unmatured part of the Note and debt secured by this Deed of Trust; and it is agreed that such
sale, if so made, shall not in any manner affect the unmatured part of the debt secured by this Deed of Trust but, as
to such unmatured part of this Deed of Trust, shall remain in full force and effect just as, though no sale had been
made under the provisions of this paragraph. And it is further agreed that several sales may be made hereunder
without exhausting the right of sale for any unmatured part of the debt secured hereby, it being the purpose to
provide for a foreclosure and sale of the security for any matured portion of the debt secured hereby without
exhausting the power to foreclose and to sell the Sc;lcurity for any other part of the debt secured hereby, whether
matured at the time or subsequently maturing. Itis agreed that an assignee holding any installment or installments
or part of any installment of the Note secured hereby shall have the same powers as are hereby conferred on the
holder of the indebtedness to proceed with foreclosure on a matured installment or installments and also to request
the Trustee or successors in trust to sell the Mortgaged Property; but if an assignee forecloses or causes a sale to be
made to satisfy any installment, part of an installment or installments, 1hen such foreclosure or sale shap be made
subject to the unmatured part of the Note and the debt secured hereby owned by the holder of the indebtedness at the
time or assigned subsequent to the assignment of the item to satisfy which the sale is being made.
(22) It is expreSsly agreed that (a) no waiver of any default on the part ofTmstors or breach of any of
the provisions of this Deed of Trust shall be considered a waiver of any other or subsequent default or breach and no
delay or omission in exercising or enforcing the rights and powers herein granted shall be construed as a waiver of
such rights and powers and, likewise, no exercise or enforcement of any right or powers hereunder shall be held to .
exhaust such rights and powers and every such right and power may be exercised from time to time; (b) any failure
by Beneficiary to insist upon the strict performance by Trustors of any of the terms and provisions hereof shall not
be deemed to be a waiver of any of the terms and provisions hereof and Beneficiary, notwithstanding any such
failure, shall have the right thereafter to insist upon the strict performance by Trustors of any and all of the terms and
provisions of this Deed of Trust; (c) neither Trustors nor any other person now or hereafter obligated for the,
payment of the whole or any part of said indebtedness shall be relieved of such obligation by reason of 1he failure of
Beneficiary or Trustee to comply with any request of Trustors or of any other person so obligated to take action to
foreclose this Deed of Tmst or otherwise enforce any of the provisions of this Deed of Trust or of any obligations
secured by this Deed of Trust or by reason of the release, regardless of consideration, of the whole or any part of the
security held for said indebtedness or by reason of the subordination in whole or in part by Beneficiary of the lien,
security interest or rights evidenced hereby or by reason of any agreement or stipulation which any subsequent
owner or owners of the Mortgaged Property extending the time of payment or modifying the terms of said
indebtedness or this Deed of Trust without filst having obtained the consent ofTmstors or such other person and, in
the latter event, Trustors and all such other persons shall continue liable to make such payments according to the
terms of any such agreement of extension or modification unless expressly released and discharged in writing by
Beneficiary; (d) regardless of consideration and without the necessity for any notice to or consent by the holder of
iManage _790822_1
6
any subordinate lien or security interest on the Mortgaged Property, Beneficiary may release the obligation of
anyone at any time liable for any of said indebtedness or any part of the security held for said indebtedness and may
extend the time of payment or otherwise modify the terms of said indebtedness and/or this Deed of Trust without, as
to the security or the remainder thereof, in anywise impairing or affecting the lien or security interest of this Deed of
Trust or the priority of such lien or security interest as security for the payment of said indebtedness as it may be so
extended or modified over any subordinate lien or security interest; (e) the holder of any subordinate lien or security
interest shall have no right to tenninate any lease affecting the Mortgaged Property, whether or not such lease be
subordinate to this Deed of Trost; and (f) Beneficiary may resort:. for the payment of said indebtedness, to any
security tht}refor held by Beneficiary in such order and manner as Beneficiary may elect.
(23) In the event that there be a trustee's sale hereunder andif, at the time of such sale, Trustors, their
heirs, executors, administrators ot assigns, be occupying the premises so sold, each and all shall immediately
become the tenant of the purchaser at such sale, which tenancy shall be a tenancy from day to day, terminable at the
will of either tenant or landlord, at a reasonable rental per day, based upon the value of the Mortgaged Property,
such rental to be due daily to the purchaser. An action of forcible detainer shall lie if the tenant holds over after a
demand in writing for possession of the Mortgaged Property; and this Deed Of Trust and the trustee's deed shall
constitute a lease and agreement under which the tenant's possession, each and all, arose and continued.
(24) In the event any portion of said iildebtedness is not, for any reason whats,oever, secured by this
Deed of Trust on the Mortgaged Property, the full amount of all payments made on said indebtedness shall first be
aPplied to such unsecured portion of said indebtedness until the same has been fuUy paid.
(25) It is agreed that the lien hereby created shall take precedence over and be a prior lien to any other
lien of any character, whether vendor's,materiaImen's or mechanics' lien hereafter created on the Mortgaged
Property and, in the event the proceeds of the Note are used to payoff and satisfy any liens heretofore existing on
the Mortgaged Property, then Beneficiary is and shall be subrogated to all of the rights, liens and remedies of the
holders of the indebtedness so paid. .
(26) The covenants herein contained shall bind and the benefits and advantages shall inure to the
respective heirs, executors, administrators, successors and assigns of the parties hereto and to any substitute trustee.
Whenever used, the singular number shall include the plural, the plural the singular, and the use of any gender shall
be applicable to all genders. The term "Beneficiary" shall also include any lawful owner, holder or pledgee of any
indebtedness secured hereby.
(27) Without limiting any of the provisions of this Deed of Trust, the Trustors, as Debtors and referred
to in this paragraph as "Debtors,"expressly:
(a) Grant unto the holder of all indebtedness described herein, as Secured Party and referred to in this
paragraph as "Secured Party," a security interest in aU of the properties hereinabove described
(including both those noW and those hereafter existing) to the full extent that same may be subject
to Chapter 9 of the Uniform Commercial code as adopted in the State of California and as it may
hereinafter be amended or suc(:eeded (hereinafter called "Uniform Commercial Code").
(b) Agree that, in addition to any other remedies granted in this instrument to the Secured party or
_ Trustee, the Secured Party may, in the event of any default, proceed under the Uniform
Commercial Code as to all or any part of the personal property (tangible or intangible) and fixtUres
included in the properties described herein or located on or affixed to the Mortgaged Property
(such portion of the properties being herein referred to as "Collateral") and shall have and may
exercise, with respect to the Collateral, all the rights, remedies, and powers of a Secured Party
under the Uniform Commercial Code including, without limitation, the right and power to sell at
public or private sale or sales or otherwise dispose of, lease or utilize the Collateral and any part or
parts thereof in any manner authorized or permitted under said Uniform Commercial Code after
default by a debtor and to apply the proceeds thereof toward payment of any costs and expenses
and attorneys' fees and legal expenses thereby incurred by Secured Party and toward payment of
the Debtors' obligations including the Note and all other indebtedness descnbed in this instroment
in such order or manner as Secured Party may elect. Among the rights of Secured Party in the
iManage_790822_1 7
event of default and, without limitation, Secured Party shall have the right to take possession of
the Collateral and to enter upon any premises where same may be situa~d. for such pUlpose
without being deemed guilty of trespass and without liability for damages thereby occasioned and
to take any action deemed necessary or appropriate or desirable by Secured Party, at its option and
in its discretion, to repair, refurbish or otherwise prepare the Collateral for sale, lease or other use
or disposition as herein authorized. To the extent permitted by law, Debtors expressly waive any
notice of sale or other disposition of the Collateral and any other rights or remedies of a debtor or
formalities prescnbed by law relative to sale or dispositiQn of the Collateral or exercise of any
other right or remedy of Secured Party existing after default hereunder; and to the extent any such
notice is required and cannot be waived, Debtors agree that if such notice is mailed, postage
prepaid, to the Debtors at the address shown herein at least five (5) days before the time of the sale
or disposition, such notice shall be deemed reasonable and shall fully satisfy any requirement for
givingofsaid notice.
(c) Grant to the Secured Party, after default hereunder, the right, at its option, to transfer at any time to
itself or to its nominee the Collateral or any part thereof and to receive the monies, income,
proceeds or benefits attributable or accruing thereto and to hold the same as security for the
Debtors' obligations or to appiy it on the principal and interest or other amounts owing on any of
the Debtors' obligations, whether or not then due, in such order or manner as the Secured Party
may elect. All rights or marshaling of assets of Debtors, including any such right with respect to
the Collateral, are hereby waived.
(d) Covenant, stipulate and agree that all recitals in any instrnment of assignment or any other instro-
ment executed by Secured Party incident to sale, transfer, assignment, lease or other disposition or
utilization of the Collateral or imy part thereof hereunder shall be full proof of the matters stated
therein and no other proof shall be requisite to establish full legal propriety of the sale or other
action taken by Secured party or of any fact, condition or thing incident thereto and all prerequi-
sites of such sale or other action or of any fact, condition or thing incident thereto shall be pre-
sumed conclusively to have been performed or to have occurred.
(e) Covenant and agree that Secured Party may require Debtors, after default hereunder, to assemble
the Collateral imd make it available to Secured party at a place to be designated by Secured party
that is reasonably convenient to both parties. All expenses of retaking, holding, preparing for sale,
lease or other use or disposition, selling, leasing or otherwise using or disposing of the Collateral
and the like which are incurred or paid by Secured Party as authorized or permitted hereunder,
including also all attorneys' fees, legal expenses and costs, shall be added to the Debtors'
obligations and the Debtors shall be liable therefor.
(t) Covenant and agree that the Secured Party may, at its election, at any time after delivery of this
instrument, sign one or more copies of this instrument in order that such copies maybe used as a
Financing Statement under the Uniform Commercial Code. Such signature by the Secured Party
may be placed between the last sentence of the instrument and the Debtors' acknowledgment or
may follow the DebtOrs' acknowledgment. The Secured Party's signature need not be acknowl-
edged and is not necessary to the effectiveness of this instrument as a deed of trost, mortgage,
assignment, pledge or security agreement.
Except for the security interest granted hereby in the Collateral, Debtors are the owners and holders of the
Collateral free of any adverse claim, security interest or encumbrance and Debtors will defend the Collateral against
all claims and demands of any person at any time claiming the. same or any interest therein. Debtors have not
heretofore signed any financing statement covering the Collateral and no such financing statement signed by
Debtors is now on file in any public office except those statements true and correct copies of which have been
delivered to the Secured Party. So long as any amount remains unpaid on any indebtednesses described in this Deed
of Trust, Debtors will not execute and there will not be filed in any public office such financing statement or
statements affecting the Collateral other than financing statements in favor of Secured Party hereunder unless the
prior written specific consent and approval of Secured Party shall have first been obtained. Debtors authorize
Secured Party to file, in jurisdictions where this authorization will be given effect, a financing statement signed only
iManage _790822_1
8
by Secured Party covering the Collateral and, at the request of Secured Party, Debtors will join Secured Party in
executing one or more fmancing statements pursuant to the Uniform Commercial Code, in fonn satisfactory to
Secured Party, and will pay the cost of filing the same or filing or recording this instrument as a financing statement
in all public offices at any time and trom time to time whenever filing. or recording of any financing statement or of
this instrument is deemed by Secured Party to be necessary or desirable.
(28) Portions of the Mortgaged Property are goods which are or are to become fixtures relating to the
property described in Exhibit "A" and the Trustors herein expressly covenant and agree that the filing of this Deed
of Trust in the real estate records of the county where the Mortgaged Properties are located shall also operate from
time of filing therein as a financing statement med as a fixture filing in accordance with the applicable section of the
Uniform Commercial Code. .
(29) Trustors will pay all fees or costs for appraisals that the Beneficiary may reasonably require from
time to time, but in no event more than one (1) appraisal annually. In addition, Trustors will pay all rerording fees,
taxes, abstract fees, attorneys' fees and all other costs and expenSes of every character from time to time incurred in
connection with the making, closing and servicing of the loan evidenced by the Note, or any renewal, modification,
rearrangement or extension thereof and will pay all reasonable fees and charges made by the Trustee for services
performed hereunder and will reimburse Beneficiary and the Trustee for all expenses incUITedby them, respectively,
and Will indemnity and hold harmless Beneficiary and the Trustee from and against all claims, demands, liabilities
and causes of action asserted against either of them on account of any act performed or omitted to be performed
hereunder or on account of any transaction arising out of or in any way connected with the Mort~ged Property or
this Deed of Trust, save and except for their willful misconduct. In the event that Beneficiary should pay for
expenses incurred in way of attorneys' fees in connection with title examination and legal matters and/or appraisal
fees or costs connected with the IDa1dng,closing or servicing the Note or any renewal, modification, rearrangement
or extension thereof, or pay any recording or filing fee or fees incident to recording instruments, title insurance
premiums and title insurance endorsement fees, Trustors shall reimburse the Beneficiary for all such sums upon
demand. Any such sums shall become part of the indebtedness ~cured by this Deed of Trust and shall bear interest
from the date incurred by Beneficiary at the rate provided in the Note.
(30) The tenD "Hazardous Materials" shall mean (a) any "hazardous waste" as defined by the Resource
Conservation and Recovery Act of 1976 (42 U.S.C. Section 6901 et seq.), as amended from time to time, and
regulations promul~ated thereunder; (b) any "hazardous substance" as defined by the Comprehensive Environmental
Response. Compensation and Liability Act of 1980 (42 U.S.c. Section 9601 et seq.), as amended from time to time,
and regulations promulgated thereunder; (c) asbestos; (d) polychlorinated biphenyls; (e) underground storage tanks,
whether empty, filled or partially filled with any substances (f) any substance the presence of which on the
. Mortgaged Property is prohibited by any Governmental Requirements; and (g) any other substance which by any
Governmental Requirements requires special h8ndling or notificatidn of any federal, state or local governmental
entity in its collection, storage, treatment or disposal. The term "Governmental Requirements" shall mean all laws,
ordinances. rules and regulation of the United StateS, the state, the county, the city or any other political subdivision
in which the Mortgaged Property is located, and any other political subdivision, agency or instrumentality exercising
jurisdiction over Trustors, any guarantor of the Note, or the Mortgaged Property.
The term "Hazardous ~aterials Contamination" shall mean the contamination (whether presently existing
or hereafter occurring) of the Mortgaged Property, any improvements, facilities, soil, groundwater, air or other
elements on or off the Mortgaged Property by Hazardous Materials, or the contamination .of the buildings, facilities,
soil, groundwater, air or other elements on .or of any other property as a result of Hazardous Materials at any time
(whether before or after the date hereof) emanating from the Mortgaged Property.
TrustorS represent and warrant to Beneficiary that:
(a) No Hazardous Materials are located on the Mortgaged Property or have been released into the
environment, or deposited, discharged, placed or disposed of at, on, under or near the Mortgaged
Property. No portion of the Mortgaged Property is being used or, to the knowledge of Trustors.
has been used at any previous time for the disposal, storage, treatment, processing or other
handling of Hazardous Materials nor is the Mortgaged Property affected by any Hazardous
Materials Contamination.
iManage _790822_1 9
(b) To the best of Trostors' knowledge, no Hazardous Materials are located in the vicinity of the
Mortgaged Property, no property adjoining the Mortgaged Property is being used, or has ever been
used at any previous. time, for the disposal, storage, treatment, processing or other handling of
Hazardous Materials, nor is any other property adjoining the Mortgaged Property affected by
Hazardous Materials Contamination.
(c) No polychlorinated biphenyls are located on or in the Mortgaged Property, in the form of electrical
transformers, fluorescent light fixtures with ballasts, cooling oils, or any other device or form.
(d)
No investigation, administrative order, consent order and agreement, litigation or settlement with
respect to Hazardous Materials or Hazardous Materials Contamination is proposed, threatened,
anticipated or in existence with respect to the Mortgaged Property. The Mortgaged Property and
its existing and prior uses comply and . at all times have complied with any applicable
Governmental Requirements,relating to environmental matters or Hazardous MateriaIs. There is
no condition on the Mortgaged Property which is in violationof any applicable Governmental
Requirements relating to Hazardous Materials, and Trustors have received no communication
from or on behalf of any Governmental Authority that any such condition exists. The Mortgaged
Property is not currently on and, to Tmstors' knowledge after diligent investigation and inquiry,
has never been on any federal or state "Superfund" or "Superlien" list.
(
(e) All representations and warranties contained in this Section shall survive the consummation of the
transactions contemplated hereby.
Trustors further represent and warrant that:
(a) Trustors agree to (i) give notice to Beneficiary immediately upon Trustors' acquiring knowledge
of the presence of any Hazardous Materials on the Mortgaged Property or of any Hazardous
Materials Contamination with a full description thereof; (ii) promptly, at Trustors' sole cost and
expense, comply with any Governmental Requirements requiring the removal, treatment or dis-
posal of such Hazardous Materials or Hazardous Materials Contamination and provide Beneficiary
with satisfactory evidence of such compliance; and (Hi) provide Beneficiary, within thirty (30)
days after demand by Beneficiary, with a bond, letter of credit or similar financial assurance
evidencing to Beneficiary's satisfaction that the necessary funds are available to pay the cost of
removing, treating and disposing of such Hazardous Materials or Hazardous Materials Contami-
nation and discharging any assessments which may be established on the Mortgaged Property as a
result thereof.
. (b) Trustors shall not cause or suffer any liens to be recorded against the Mortgaged Property as a
consequence of, or in any way related to, the presence, remediation or disposal of Hazardous
Material in or about the Mortgaged Property, including any state, federal or local so-called
"Superfund" lien relating to such matters.
(c) Trostors shall at all times retain any and all liabilities arising from the presence, handling,
treatment, storage, transportation, removal or disposal of Hazardous Materials on the Mortgaged
Property. Regardless of whether any Event of Default shall have occurred and be continuing or
any remedies in respect of the Mortgaged Property are exercised by Beneficiary, Trostors shall
defend, indemnify and hold harmless Beneficiary from and against any and all liabilities
(including strict liability), suits, actions, claims, demands, penalties. damages '(including, without
limitation, lost profits, consequential damages, interest, penalties, fines and monetary sanctions),
losses, costs or expenses (including, without limitation, attorneys' fees and expenses, and remedial
costs) (the foregoing are hereinafter collectively referred to as "Liabilities") which may now or in
the future (whether before or after the culmination of the .transactions contemplated hereby
incurred or suffered by Beneficiary by reason of, resulting from, in connection with, or arising in
any manner whatsoever out of the breach of any warranty or covenant or the inaccuracy of any
representation of Trustors contained or referred to in this Section or which may be asserted as a
direct ot indirect result of the presence on or under, or escape, seepage, leakage, spillage,
iManage_790822_1 10
discharge, emission, or release from the Mortgaged property of any Hazardous Materials or any
Hazardous Materials ContarD.ination or arise out of or result from the environmental condition of
the Mortgaged froperty or the applicability of any Governmental Requirements relating to
Hazardous Materials, whether or not occasioned wholly or in part by any condition, accident or
event caused by any act or o,mssion of Beneficiary.
Such Liabilities shall include, without limitation; (i) injury or death to any person; (ii) damage to
or loss of the use of any property; (ill) the cost of any demolition and rebuilding of the improve-
ments, repair or remediation and the preparation of any activity required by any Governmental
Authority; (iv) any lawsuit brought or threatened, good faith settlement reached, or governmental
order relating to the presence, disposal, re.lease or threatened release of any Hazardous Material
on, from or under the Mortgaged Property; and (v) the imposition of any lien on the Mortgaged
Property arising from the activity of Trostors or Trustors' predecessors in interest on the
Mortgaged Property or from the existence of Hazardous Materials or Hazardous Materials
Contamination upon the Mortgaged Property.
The covenants and agreements contained in this Section shall survive the consummation of the
transactions contemplated hereby.
Notwithstanding anything contained in the Note, this Deed of Trust or in any of the loan documents, the
Trustors shall not be released of personal liability and shall have personal liability for any and all of Beneficiary's
costs, expenses, damages or liabilities (including, without limitation, all reasonable attorneys' fees, whether incurred
by Beneficiary prior to or following foreclosure of the Deed of Trust and whether Beneficiary shall be in the status
of a lienholder or an owner of the Mortgaged Property following . foreclosure) directly or indirectly arising out of or
attributable to the use, generation, manufacture, storage, release, threatened release, dischargc:, disposal, or presence
on, under, to, from or about the Mortgaged Property of any Hazardous Materials and/or Hazardous Materials
Contamination.
(31) Beneficiary hereby agrees to the following for the benefit of the Lessor: (i) Beneficiary's interest
in the Real Property is subordinate to the rights of the Lessor in and to the Real Property; (ii) this Deed of Trust is
subject to and subordinate to each of the covenants, conditions and restrictions set forth in the Ground Lease, except
as specifically set forth in the Ground Lease; (iii) Beneficiary shall not exercise any of its remedies hereunder,
including acceleration of the maturity of the Note, for any default or defaults of the Grantors thereunder or in
connection with the indebtedness evidenced by the Note of the Grantors, without first advising the Lessor in the
manner provided in Section 23 of the Ground Lease and permitting the Lessor to cure any such default which is
.. capable of being cured within thirty (30) days after the time Trustors have to cure such default; (iv) Beneficiary shall
accept a cure by the Lessor of any such default hereunder which is capable of being cured, except that the Lessor
shall not be required to cure any such default; and (v) all payments so made and all things so done or performed by
the Lessor shall be as effective. to prevent an acceleration of the maturity of the Note, the foreclosure of
Beneficiary's interest in the Real Property or the exercise of any other remedies by the Beneficiary upon default by
the Grantors hereunder as the same would have been if paid, done or performed by the Grantors instead of the
Lessor. The Lessor shall not be or become liable to the Beneficiary. as a result of the right and option to cure any
such default or defaults by Grantors.
(32) TRUSTORS HEREBY EXPRESSLY RECOGNIZE THAT CONTAINED IN SECTIONS (29)
AND (30) OF TIllS DEED OF TRUST ARE PROVISIONS WHICH REQUIRE mUSTORS TO INDEMNIFY
BENEFICIARY UNDER CERTAIN CIRCUMSTANCES AND TRUSTORS HEREBY ACKNOWLEDGE mAT
BY EXECUTING lHIS OEED OF TRUST, TRUSTORS ACCEPT TIlESE PROVISIONS AND TIIE
OBLIGATIONS TO INDEMNIFY BENEFICIARY UNDER SUCH CIRCUMSTANCES.
iManage _790822 _I
11
EXECUTED this _ day of April, 2005.
UNION ICE-PACIFIC, L.P., a California limited
partnership
By: UNION ICE GP INC., a Texas corporation,
its General Partner
By:
Peter S. Wareing, Chairman
STATE OF TEXAS ~
~
COUNTY OF HARRIS ~
This instrument was acknowledged before me on this _ day of April, 2005, by Peter S. Wareing,
Chairman of Union Ice GP Inc., a Texas. corporation, in its capacity as the General Partner of Union Ice-Pacific,
L.p", a California limited partnership, for and on behalf of said partnership.
[S E A L]
Notary Public, STATE OF TEXAS
iManage _790822_1
12
-')
ExomIT "A"
iManage_790822_I